1 

1 

i 

THE 
ARGENTINE    IN    THE 
TWENTIETH    CENTURY 


THE  ARGENTINE   in  the 
TWENTIETH    CENTURY 

By      albert       B.      MARTINEZ 

•:X-UNDER-SECRETARY    OF    STATE  .  .  AND 

MAURICE  LEWANDOWSKI,  DOCTOR  INLAW. 


With  a  Preface  by  M.  EMILE  LEVASSEUR,  Membre 
de  rinstitut,  and  an  Introduction  by  the  late  CH. 
PELLEGRINI,     Ex-President     of     the     Argentine     Republic. 

Translated  by  BERNARD  MIALL  from  the  French 
of  the  Third  Edition,  revised  and  brought  up  to  date. 


WITH  A  MAP 


BOSTON 

SMALL,  MAYNARD  AND  COMPANY 

PUBLISHERS 


[A//  Rights  Reserved] 


CONTENTS 


Author's  Note 

Author's  Preface  to  thr  Third  Edition 

Preface  to  the  First  Edition 

Introduction 

General  Plan  and  Method  of  this  Book 

The  Argentine  Nationality 


PAGE 

xiii 

XV 
XXV 

xli 
55 
59 


PART    I.    • 
The  Argentine  fkom  the  Economic  Standpoint. 


I.  The  Geography  of  the  Argentine 

Climate — Son. — Geographical  situation  of  the  Argentine  ;  its 
boundaries,  its  area. 

Climate  of  various  districts.  The  prevailing  winds.  Nature 
of  the  soil  ;  its  fertility  ;  adaptation  to  the  culture  of 
cereals  and  the  raisijig  of  live-stock — Transformation  of 
virgin  into  fertile~land — The  Pampa — The  cultivable  area 
—  Conditions  favourable  to  production — The  plague  of 
locusts. 

RivEBS — Their  exceptionally  favourable  influence — The  hydro- 
graphic  system — Network  of  navigable  river-ways  :  the 
Rio  de  la  Plata,  the  Rio  Parana— Conditions  of  navigability 
— Canals. 

PoRTB — List  of  the  principal  ports,  with  a  summary  of  their 
trade — Buenos  Ayres  :  description  of  the  port,  its  area,  its 
capacity,  tonnage  ;  its  docks — The  Central  Produce  Market 
— Impoi-tance  of  Buenos  Ayres  in  comparison  with  the 
great  ports  of  the  world — The  port  of  La  Plata — The  j  ort 
of  Rosario  ;  increase  of  its  trafKc  ;  construction  of  the  new 
harbour  conceded  to  a  French  company— Bahia  Blanca; 
its  development — The  decentralisation  of  traffic. 


II.  Railways 


Rapid  development  of  the  railway  system — Tabulation  of  its 
extension  in  each  Province — Table  showing  the  general 
results  of  its  operation — List  of  the  lines  actually  running. 

List  of  railway  companies,  with  the  length  of  their  roadways 
and  their  returns — The  difficulty  of  obtaining  these  figures 
exactly — The  tariffs  of  the  railway  companies — Form  of 
concessions,  and  suppression  of  guarantees. 

Comparison  of  the  railway  system  of  the  Argentine  with  the 
railway  systems  of  other  countries — Proportion  of  mileage 
to  area  and  population. 


•AC.E 

71 


91 


vi  CONTENTS 

CHAP.  PAGE 

II. — continued — 

Extension  of  the  system  in  the  near  future,  owing  tu  ilie 
numerous  concessions  granted — The  mileage  of  these  con- 
cessions— Insufficiency  of  plans  and  previous  examination 
— Examination  of  the  most  important  concessions  for  which 
the  capital  is  already  guaranteed — The  dimensions  which 
the  railway  system  will  attain  after  the  concessions  are 
realised — Programme  of  narrow-gauge  construction  ;  its 
value. 

Meeting  of  the  Argentine  with  the  Chilian  railways  across  the 
range  of  the  Andes — The  aerial  mining  railway  in  the 
Province  of  La  Rioja. 

Railways  in  relation  to  agricultural  development —  Insufficiency 
of  transport  at  the  moment  of  harvest ;  its  causes  and 
remedies — Necessity  of  a  better  organisation  which  shall 
respond  to  the  stress  of  production. 

III.  Immigration  and  Colonisation    ...  ...  ...       113 

Immigration  is  a  vital  problem  for  the  Argentine — Table  of  the 
population  per  Province  and  per  Territory.  Its  sparsity — 
The  exceptional  situation  of  the  Argentine  as  the  objective 
of  European  emigration — The  poor  results  hitherto  ob- 
tained through  default  of  colonisation — The  faulty  division 
of  the  public  lands — History  of  immigration  in  relation  to 
colonisation — The  nationality  of  immigrants. 

PART   II. 

The  Argentine  as  an  Agricultural  Country. 

I.  Agriculture    ...  ...  ...  ...  ...       125 

Natural  Conditions — The  Constitution  of  Property — The 
three  principal  agricultural  districts  —  The  northern, 
central,  and  southern  districts — The  division  of  crops  and 
their  varieties. 

The  constitution  of  rural  property — The  division  of  property — 
The  great  estates,  called  "estancias,"  and  their  size. 

The  drawbacks  of  large  properties — The  necessity  of  a  better 
subdivision  of  the  public  lands — The  division  into  lots  of 
large  tracts  of  land,  in  order  to  encourage  colonisation — The 
system  of  exploiting  property. 

Agricultural  Production  —  The  progress  realised  in  last 
seventeen  years — Comparative  yield  of  the  chief  products, 
wheat,  flax,  and  maize — Lucerne ;  the  importance  of  the 
crop  and  the  excellent  results  obtained. 

Increase  of  the  area  under  seed— The  total  area  cultivated  in 
the  agricultural  years  1908-1909 — The  great  agricultural 
belts. 

The  Province  of  Buenos  Ayres,  its  agricultural  development 
and  its  crops — The  Province  of  Santa  Fe — The  Province 
of  Cdrdoba — The  Territory  of  the  Central  Pampa. 

Agricultural  machinery,  its  importation  from  abroad,  and  es- 
pecially from  the  United  States. 

The  Agricultural  Yield — The  yield  of  the  soil  in  the  different 
Provinces — Exceptional  results   in    certain    districts — De- 
tailed  calculation   of   the  yield   of   a  wheat   farm — T- 
instances  of   great  wealth  realised  by  immigtants  to  tt 
Argentine. 


CONTENTS  vii 

CHAP.  ''^"* 

II.  The    Pkoduction    of    Wheat     in    the    Argentine 
compared  with  the  yield  of  other  exportinc 
Countries  ...  ...  ...  ...       151 

The  world's  wheat-harvest — Comparison  between  the  statistics 
of  consumption — The  conditions  of  production  in  Russia 
and  in  the  Argentine  —  Comparison  with  the  United 
States,  India  and  Canada— The  prospects  of  the  Argen- 
tine export  trade  in  wheat. 

III.  Stock-raising^  ...  ...  ...  .-■  ...       162 

The  Transformation  of  the  old  "estancia  " — The  principal  stock- 
raising  establishments  ;  description,  extent,  number  of 
heads  of  cattle  and  favourite  breeds — The  great  "  estancias" 
of  the  South  and  Patagonia. 

Approximate  area  of  the  soil  devoted  to  cattle  and  sheep ; 
general  estimate  of  the  numbers  of  cattle  and  sheep — 
Results  of  the  census  of  1908.— The  capital  represented  by 
Argentine  stock-raising. 

IV.  The  Value  of  the  Soil  ...  ...  ...       174 

Difficulties  in  estimating  this  value — Principal  factors  of  valua- 
tion— Examples  taken  from  lucerne  fields  and  the  forests 
of  quebracho — Despite  adverse  circumstances,  and  with  a 
few  exceptions,  there  has  always  been  a  tendency  for  the 
price  of  land  to  rise — Alienation  of  lands  acquired  by  con- 
quest from  the  Indians  ;  their  enormous  present  value — 
The  rise  of  value  dates  from  1902,  and  has  hitherto  con- 
tinued without  relapse — The  causes  of  this  rise,  and  its 
rational  principles,  according  to  an  authoritative  opinion. 

Examples  of  valuation  drawn  from  the  sales  of  public  lands — 
The  rise  of  prices  in  the  Provinces'of  Buenos  Ayres,  Cordoba, 
Santa  Fe,  and  the  Pampa,  with  figures  indicating  the 
prices  realised  in  some  large  recent  transactions. 

V.  Agricultural  Industries  ...  ...  ...       187 

Sugak-Cane — Area  of  plantations — Statistics  of  production — 
Legislation  affecting  sugar — Consumption. 

Vines — Area  of  vineyards  planted  —Production,  consumption — 
Imperfect  quality — Competition  of  foreign  imports. 

Tobacco — Area  of  plantations — Value  of  the  product — De- 
fective preparation. 

The  Mulberry — The  culture  of  the  silk-worm  might  be  estab- 
lished in  the  Argentine,  but  at  present  exists  only  in  an 
experimental  condition. 

Mate — Large  consumption  of  this  product. — Statistics  of  foreign 
importation — Districts  suitable  for  its  growth. 

Cotton — Physical  conditions  jiroper  to  its  growth — The  first 
favourable  results  in  the  Argentine — Its  introduction  into 
Chaco — Lack  of  manual  labour  for  the  development  of  this 
industry. 

Rubber — Existence  of  rubber  plants  in  the  Argentine — An  un- 
exploited  source  of  wealth. 

Arboriculture — On  account  of  the  diversity  of  the  climate,  all 
fruit-trees  can  be  grown  in  the  Argentine — The  various 
fruits  cultivated  in  different  regions — Amelioration  of  the 
products.  The  trade  in  fruit — Its  development  possible 
on  account  of  the  inversion  of  seasons  as  compared  with 
Europe — Refrigeration  applied  to  the  transport  of  fruit — 
Regions  particularly  suitable  for  fruit-growing. 


riii  CONTENTS 

PART  III. 

The  Argentine  from  the  Commercial  and  Industrial 
Point  op  View. 

:hap.  page 

I.  Foreign  Trade  ...  ...  ...  ...       211 

The  important  part  played  by  the  foreign  trade  of  the  Argen- 
tine— Table  of  imports  and  exports  during  recent  years — 
Explanation  of  their  respective  movements — Favourable 
condition  of  the  commercial  balance. 

Method  of  ascertaining  the  statistics  of  exports  and  imports — 
Errors  in  evaluation — Notes  on  the  import  duties  on  various 
articles — Variations  of  the  custom  duties — Export  duties  ; 
their  transitory  characters — The  trade  in  bullion. 

Imports. — Their  classification  according  to  their  countries  of 
origin— Value  of  imports  from  each  country,  vdth  indica- 
tions of  the  principal  articles  imported — The  Argentine 
dependent  upon  other  countries  for  a  large  number  of 
manufactured  articles  —  Concentration  of  imports  at 
Buenos  Ayres. 

Exports. — Their  classification  according  to  origin — Value  of 
exports  from  each  district,  with  indications  of  the  chief 
articles  exported — Decadence  of  the  French  trade  with  the 
Argentine  and  its  causes. 

Tabulation,  according  to  importance  of  the  principal  products 
exported  by  the  Argentine  —  Remarkable  increase  in 
agricultural  and  pastoral  exports — Search  for  new  outlets. 

Eventual  denunciation  of  commercial  treaties — Projected  new 
treaty  with  France — Causes  of  the  superiority  of  English, 
German,  and  North  American  trade  in  the  Argentine  over 
French  trade. 

"  Dumping  "  in  the  Argentine — A  new  client  for  the  Argentine 
— Japan — Elements  which  make  for  the  development  of 
commercial  activity  in  the  Argentine. 

The  commercial  balance — Results  of  the  commercial  balance 
— Its  prime  importance  in  respect  of  the  prosperity  of  the 
coimtry — It  is  this  balance  which  compensates  the  issue  of 
capital  for  the  benefit  of  the  foreign  debt. 

II.  The  Great  Argentine  Industries  ...  ...       235 

The  principal  industries  of  the  country  are  related  to  agriculture 
and  cattle-breeding. 

Sugar-planting,  Boiling,  etc. — Capital  engaged — Tucuman 
the  chief  centre — Production  and  exportation — The  sug.ir 
crisis — The  Rosario  Refinery. 

Flour  Export  Trade — Capital  invested — Equipment,  steam 
flour-mills,  grain-elevators — Production  and  exportation. 

Refrigeration. — At  present  the  chief  industry  of  the  country 
— Number  of  establishments — Table  of  exports  of  frozen 
and  chilled  meats— Capital  invested — Development  of  the 
industry. 

Dairy  Inddstries. — The  large  establishments  devoting  them- 
selves to  these  industries — Butter  ;  cheese — Exports  of 
butter  ;  the  development  of  which  the  dairy  industries  are 
capable. 

Breweries. — Chief  establishments — Production  and  consump- 
tion of  beer  during  the  years  1902-1907— Suppression  of 
imports  of  foreign  beer. 


CONTENTS  ix 

CHAP.  ,  ""AGK 

II. — continued — 

Spikits — ^Decreased  production  of  spirits. 

Looms,  Tanneries. — Weaving  and  tanning  are  industries 
which  at  present  exist  in  the  Argentine  only  in  a  rudi- 
mentary condition,  despite  the  conditions  which  are  favour- 
able to  their  development. 

QQBBRAaaa3yooD. — The  centre  of  production — Applications — 
Companies  engaged  in  the  industry — Their  results — Value 
of  the  products  and  the  large  profits  to  be  expected. 
.  TiUiiEB..TjiAJDE.— Varieties  of  timber  and  hard  woods. 

Fisheries. — First  results  of  this  industry. 

III.  Mines,  Electrical  and  other  Industries  ...       250 

The  Argentine  has  not  entered  the  industrial  age — She  has  no 

coal-mines  in  operation,  no  natural  motive  forces  of  any 

importance. 
Mines. — Symptoms  of  the  awakening  of  the  mining  industry — 

Numerous  lodes  in  the  Andes — The  mines  of  La  Rioja  and 

Catamarca — Mines   in    other   provinces  and   territories — 

Mining  legislation. 
Elkctrio  Industries. — Tramways;   their  development,  their 

perfected  equipment,  and  their  profits — Progress  of  electric 

lighting — Telegraphs — Telephones. 
Various  Industries. — List  of  various   industries  established 

in  Buenos  Ayres,  according  to  the  last  census,  with  the 

value  of  their  products. 
Comparison  between  the  statistics  of  1895  and  those  of  1904 — 

Progress  realised  in  1908 — Workshops  and  factories. 

IV,  Banks,     the    Bourse    or    Stock    Exchange,     and 

Limited  Companies  ...  ...  ...       261 

Banks — International  character  of  Argentine  banking — Evolu- 
tion of  banking  machinery — List  of  the  principal  banks, 
with  amount  of  capital  and  business  done — Conditions 
peculiar  to  Argentine  banking ;  the  lack  of  movable  re- 
serves— Rates  of  interest  on  account,  on  deposit,  and  on 
advances — Statistics  of  the  deposit  accounts  of  the  principal 
banks — Exchange  operations:  their  decrease  since  the 
determination  of  a  fixed  monetary  ratio — The  Clearing 
House  ;  the  importance  of  its  operations. 
The  Bank  of  the  Nation. — Its  history — The  formation  of  its  capital — 
Political  interference  in  the  nomination  of  its  Directors — 
Statistics  of  its  accounts — Rapid  increase  of  deposits — Diffi- 
culty of  realising  capital — The  resumption  of  payments. 

The  Bank  of  the  Province  of  Buenos  Ayres — Its  reorganisation 
— Its  present  prosperity. 

Mortgage  and  Loan-Banks. — History  of  the  Banqiie  Hypothe- 
caire  of  the  Province  of  Buenos  Ayres — Bankruptcy — 
Arrangement  between  the  bank  and  its  creditors — Proposal 
of  reorganisation — Laws  relating  to  mortgage  in  the  Argen- 
tine—The National  Mortgage  Bank  ;  statistics  of  business 
done  —  Joint-stock  loan  companies  ;  their  capital  and 
amount  of  business  done. 

The  Stock  Exchange  (Bourse).— History  of  this  institution- 
Its  importance  ;  its  functions  ;  amount  of  business  done — 
The  decrease  in  its  transactions  since  the  cessation  of 
speculation  in  currency  or  the  monetary  ratio. 

The  Bourse  is  a  private  establishment — Its  membership  and  its 
regulations— Statistics  of  business  done  during  the  last  ten 


X  CONTENTS 

CHAP.  p^Qg 

I V.  — continued — 

years — Securities  quoted  on  the  Buenos  Ayres  Bourse — 
Decrease  in  the  total  amount  of  business  done  during  the 
last  five  years— The  monetary  reform  of  1901  as  a  factory 
of  this  decrease — The  place  occupied  by  the  Stock  Exchange 
in  the  life  of  the  nation. 
Joint-Stock  Companies. — The  development  of  joint-stock  com- 
panies —  Legislation  affecting  such  companies  —  Abuses 
committed  in  the  formation  of  such  companies,  due  to 
speculation — Statistics  of  capital  invested  in  joint-stock 
companies  before  and  after  the  speculative  crises  of  1890 — 
Revival  of  such  companies,  in  a  sense  more  consistent  with 
the  development  of  the  country. 

PART   IV. 

Argentine  Finance. 
I.  The  Argentine  Budget  ...  ...  ...       295 

The  financial  situation — Continual  increase  of  national  expendi- 
ture— Great  and  rapid  progress  since  1891 — InsufiSciency 
of  the  means  adopted  to  moderate  this  increase — The 
Budget  Extraordinary  and  the  Special  Legislation  Budget. 

Causes  of  this  increase  of  national  expenditure — The  increase 
of  administrative  requirements  caused  by  an  increasing 
population  ;  this  is  the  most  natural  cause,  and  that  most 
easily  justified — Increase  of  the  public  debt — The  interven- 
tion of  the  State  as  the  promoter  or  guarantor  of  important 
public  undertakings — Exaggerated  military  expenses. 

The  total  sum  of  national,  provincial,  and  municipal  expenses. 
The  proportion  per  inhabitant — Comparison  with  other 
foreign  countries  in  the  matter  of  administrative  expenses. 

The  national  revenue — The  revenue  as  organised  by  the  Con- 
stitution, and  its  analysis — Indirect  taxation — The  customs 
the  chief  source  of  revenue — Direct  taxation  ;  its  origin  in 
the  Argentine  ;  its  justification  ;  its  yield — Revenue  of  the 
industrial  undertakings  belonging  to  the  State  :  railways, 
sewers,  posts  and  telegraphs — The  exploitation  of  the  State 
lands. 

Elasticity  of  the  receipts,  which  follow  the  development  and 
progress  of  the  country — The  accelerated  increase  of  ex- 
penditure, and  the  resulting  chronic  deficit — Necessity  of 
serious  reforms. 

II.  The  Public  Debt  ...  ...  ...  ...       312 

Statistics  of  the  public  debt  on  the  1st  January  1909 — History 
of  the  public  debt— The  first  loans. 

The  financial  crisis — Consolidated  loans — The  Romero  arrange- 
ment—Loan for  the  redemption  of  guarantees — The  internal 
public  debt — The  total  of  the  Argentine  public  debt,  and 
its  annual  cost  in  dividends  and  redemption — The  propor- 
tion of  financial  charges  as  compared  to  other  budgetary- 
expenses. 

The  burden  of  the  public  debt  is  heavy,  but  not  unduly  heavy 
in  relation  to  the  productive  power  of  the  country — The 
necessity  of  restraining  further  issues  and  of  converting  old 
debts — The  efi"orts  of  the  Argentine  to  improve  her  credit. 


CONTENTS  xi 

CHAI'.  I'AdE 

III.  The  Double  Currency  ...  ...  ...       330 

The  persistence  of  the  double  currency — The  history  of  paper 
money — The  origins  of  the  premium  on  gold,  and  its 
almost  continual  increase — The  year  1890  and  the  deprecia- 
tion of  the  currency — The  causes  of  this  depreciation  ; 
abuses  in  the  issue  of  paper,  caused  by  a  bad  financial  and 
administrative  policy. 

Reined  ies  suggested — Rosa's  law  fixing  the  value  of  paper  money 
and  establishing  a  Caissc  de  Conversion — Opposition  to  this 
law  —  Its  beneficent  effect  upon  agriculture  and  stock- 
raising,  which  had  especial  need  of  a  stable  medium  of 
exchange — Reserve  fund  created  with  a  view  to  converting 
paper  money  ;  its  vicissitudes  in  the  past  and  its  present 
constitution — The  present  monetary  situation. 

IV.  The  Caisse  de  Convehsion  ...  ...  ...       342 

The  principles  on  which  the  establishment  of  this  institution  is 
based — The  necessity  of  a  rapid  redemption  of  fiduciary 
money— The  doubtful  success  of  this  programme— New 
issues  of  notes — New  attributes  of  the  Caisse  dating  froiu 
1899 — The  exchange  of  paper  for  gold  and  vice  versa — The 
development  of  this  system  of  exchange — The  authority 
attaching  to  the  Caisse. 

Y.  The   Balance-sheet    of    the    Argentine   according 

TO  THE  Inventory  of  Securities         ...  ...       34& 

The  Inventory  of  Movable  Property  or  Securities— The 
capital  represented  by  movable  properties,  stocks,  bonds, 
shares,  etc.,  is  the  only  kind  of  capital  which  lends  itself 
to  statistics — The  great  groups  of  movable  properties  : 
National  Funds,  Railway  Shares,  Insurance  Companies, 
Foreign  Banks,  Mortgage  Companies,  and  agricultural 
and  industrial  undertakings. 

The  nominal  amount  of  capital  represented  by  movable  values 
— Table  of  the  annual  revenues  of  the  same,  and  the  sink- 
ing fund — Division  of  this  revenue  am< mg  the  different 
countries  having  capital  invested  in  tlie  Argentine. 

English  capital — The  importance  of  English  investments  in  all 
branches  of  Argentine  activity — The  benefits  of  a  reaction 
in  favour  of  Argentine  capital — French  capital ;  its  small 
value  compared  to  English  capital — German  capital  and  its 
rapid  increase— Approximate  valuation  of  that  portion  of 
revenue  remaining  in  the  Argentine,  and  of  that  which 
goes  to  the  various  nations  having  capital  invested  in  the 
country. 

The  Balance-Sheet — The  assets  are  principally  composed  of 
exportation  values ;  the  liabilities,  by  the  value  of  imports 
— The  revenue  of  investments  exported  to  foreign  countries, 
and  the  total  of  the  sums  expended  by  the  Argentines 
abroad — Table  giving  a  summarised  Balance-sheet  and  the 
balance  in  favour  of  the  Argentine-— International  ex- 
changes and  the  importation  of  gold  confirm  this  favourable 
situation — Argentine  capital  will  presently  play  a  more 
important  part  in  the  country  as  compared  with  foreign 
capital. 

Conclusions  ...  ...  ...  ...  ...       370 

Index         ...  ...  ...  ..  ...  ...       373 


AUTHOR'S  NOTE 

A  T  the  outset  of  this  work  our  thanks  are  duo  to  SeSor 
-^  J.  Romero,  ex-Minister  of  Finance,  who  has  given  us 
tlie  benefit  of  his  experience  for  this  study  of  current 
Argentine  affairs.  Seuor  Romero  is  the  author  of  the 
monetary  law  of  1881,  and  was  responsible  for  the  arrange- 
ment of  the  foreign  Debt  of  1892;  he  is  to  be  numbered 
among  those  Ministers  who  have  rendered,  in  the  course 
of  their  financial  administration,  the  greatest  services  to 
their  country. 

We  must  also  pay  tribute  to  the  memory  of  two  eminent 
gentlemen,  no  longer  living,  whose  death  the  Argentine 
deplores ;  who  had  desired,  by  aiding  us  with  their  advice, 
to  be  in  some  sort  collaborators  in  this  work,  destined  as  it 
is  to  make  popularly  known  to  European  readers  the  present 
prosperity  of  the  Argentine  Republic. 

We  must  express  our  utmost  gratitude  first  of  all  to 
Signor  Pellegrini,  that  eminent  man  who  assumed  the 
Presidency  of  the  Republic  in  a  difiicult  moment  of  her 
history.  We  are  greatly  honoured  in  that  we  are  able  to 
associate  his  name  with  this  book,  by  publishing,  as  an 
Introduction,  a  most  interesting  study  of  the  formation  of 
the  Argentine  Republic,  which  was  one  of  the  last  writings 
of  this  eminent  citizen. 

And  we  must  not  forget  the  friendly  and  conscientious 
assistance  rendered  us  so  willingly  by  one  of  the  most 
notable  figures  in  the  financial  world  of  the  Republic : 
M.  Ernest  Tornquist,  whose  death  was  also  most  truly  a 
national  bereavement.     M.  Tornquist  exercised  a  consider- 


xiv       THE  ARGENTINE  IN  THE  20th  CENTURY 

able  influence  over  the  trend  of  affairs,  and  he  most  notably 
contributed  to  the  work  of  economic  expansion,  and  financial 
and  monetary  reorganisation,  of  which  the  Argentine  is 
to-day  feeling  the  beneficial  effects.  We  have  profited,  in 
writing  this  book,  by  his  incontestable  competence,  and 
respectfully  salute  the  memory  of  this  willing  friend  and 
collaborator. 


AUTHOR'S   PREFACE   TO    THE    THIRD 
EDITION 

THREE  years  have  elapsed  since  the  appearance  of  the 
first  edition  of  this  book,  and  we  have  to-day  the 
satisfaction  of  being  able  to  state  that  the  development  of 
the  country  has  fully  responded  to  our  optimistic  forecast. 
Short  as  such  a  period  is  in  the  life  of  a  people,  it  has  been 
extraordinarily  full ;  the  ground  covered  is  so  considerable 
that  it  is  of  a  larger  Argentine  that  we  now  have  to  revise 
the  picture,  while  recording  its  pacific  victories  in  the 
economic  field. 

No  country  in  the  world  has  ever  in  so  short  a  time 
realised  so  rapid  a  progress,  in  respect  of  the  produce  of  the 
soil.  In  1904-1905  the  area  under  culture  was  as  yet  no 
more  than  22i  millions  of  acres,  while  to-day,  in  the  agri- 
cultural year  of  1908-9,  it  attains  the  figure  of  35  millions 
of  acres,  representing  an  increase  of  nearly  75  J3er  cent.  In 
the  same  period  the  value  of  cereals,  which  was  about 
£1,600,000  in  1904-5,  has  also  increased  in  very  large 
proportion. 

Taking  as  basis  the  figures  furnished  by  the  Division  of 
Rural  Economy  and  Statistics  of  the  Ministry  of  Agriculture, 
we  may  estimate  that  the  harvest  of  1908-9  Avill  give  a  yield 
of,  13,811,000  (metric)  tons,*  which  may  be  divided  as 
follows:  Wheat  5,760,000  tons,  flax  1,228,000,  oats  823,000, 
and  maize  6,000,000  tons.  The  value  of  the  harvest,  accord- 
ing to  the  prices  ruling  in  1908,  will  amount  to  1045  millions 
of  paper  piastres,  or  £92,000,000. 

To  appreciate  these  figures  at  their  true  value,  one  must 
remember  that  twenty-five  years  ago  the  Argentine  was  still 
importing  foreign  flour  to  make  her  bread,  while  to-day  the 

•  Reducing  the   above  quantities  to    bushels  of  56  lbs.   weight,  the   cereal 
harvest  is  estimated  at:  wheat,  230,000,000  bushels;  oats,  33,000,000;  maize, 
:i40,000,000.     The  metric  ton  is  34-5  lbs.  lighter  than  ihe  English, 
XV 


xvi    THE  ARGENTINE  IN  THE  20th  CENTURY 

production  of  grain  represents  nearly  a  ton  per  head  per 
inhabitant. 

It  is  the  same  with  maize :  twenty  years  ago  it  was 
hardly  grown,  and  to-day  the  harvest  amounts  to  6  millions 
of  tons ;  furnished  almost  entirely  by  two  provinces — those 
of  Buenos  Ayres  and  Santa  Fe. 

As  for  stock-raising,  we  cannot  make  a  comparison  with 
any  very  recent  statistics — since  the  last  available  date  back 
to  1895 — but  we  may  say  that  the  general  census  which  has 
just  been  undertaken,  under  the  direction  of  Sehor  Alberto 
B.  Martinez,  has  revealed  a  wealth  whose  magnitude  surpasses 
all  conception.  To-day  the  Argentine  counts  29,116,625 
horned  cattle,  67,211,754  sheep,  7,531,376  horses,  750,125 
mules  and  asses,  and  3,945,086  goats ;  which  is  equivalent, 
at  the  present  time,  to  a  capital  of  1481  millions  of  paper 
piastres,  or  £130,000,000.  By  referring  to  the  figures  for 
1895,  which  give  us  21,701,526  horned  cattle  and  4,446,859 
horses,  we  may  judge  of  the  immense  progress  which  the 
Argentine  has  realised  in  a  few  years,  thanks  to  the  trans- 
formation of  3f  millions  of  acres  of  soil  into  magnificent 
pastures  of  lucerne. 

On  the  other  hand  we  must,  it  is  true,  note  a  decrease  of 
7,167,808  head  of  sheep,  which  are  gradually  falling  back 
before  the  advance  of  agriculture  and  the  increasing  numbers 
of  cattle.  This  harmless  animal  contents  itself  with  a  poorer 
soil,  and  does  not  fear  the  intemperance  of  the  seasons ;  also 
sheep-raising  is  now  giving  place,  in  our  central  provinces, 
to  other  more  remunerative  industries,  and  the  sheep  are 
taking  refuge  in  great  quantities  in  the  southern  regions.* 

If  we  consider  these  facts  with  a  view  to  noting  the 
precise  direction  in  which  the  Argentine  is  to-day  evolving, 
we  shall  observe  a  marked  tendency  towards  the  extension 
of  agriculture  proper,  and  a  check  in  the  progress  of  stock- 
raising,  which  appears — at  least  for  the  moment — to  be 
developing  more  slowly  than  of  old. 

This  characteristic  change  is  perceptible  each  year  in  the 

*  Patagonia,  and  even  Tierra  del  Fuego,  with  its  terrible  winds  and  drench- 
ing rain,  is  now  being  occupied  by  the  sheep-rancher,  to  the  destrnction  of  the 
guanaco  and  the  natives ;  frost  being  rare  save  on  the  ranges,  and  the  pasture 
luxurious. — [Trans.] 


AUTHOR'S  PREFACE  xvii 

statistics  of  foreign  trade.  The  exportation  of  agricultural 
products  amounted,  for  the  year  1907,  to  the  value  of  164 
millions  of  piastres  (gold),  or  £32,800,000  as  against 
£32,400,000  and  £34,000,000  for  the  two  preceding  years. 
As  for  the  products  of  stock-raising,  the  value  in  1907 
amounted  only  to  £24,800,000,  while  in  the  two  preceding 
years  it  was  £24,800,000  and  £28,200,000  ;  and  ten  years  ago 
it  exceeded  by  more  than  £10,000,000  the  value  of  the  agri- 
cultural exports. 

Many  causes  are  contributing  to  this  transformation  of 
a  pastoral  into  an  agricultural  country ;  their  action  is  pro- 
gressive, and  they  are  profoundly  modifying  the  aspect  of 
the  land,  by  gradually  substituting,  for  the  monotonous 
horizons  of  the  ranchero's  prairies,  the  variety  of  cultured 
fields. 

While  the  prices  of  cereals  have  always  attained  a  remuner- 
ative figure,  those  of  the  bestial,  on  the  contrary,  have  now 
and  then  suffered  sensible  depression ;  and,  what  is  still  more 
serious,  the  ranching  industries  have  also  suffered,  as  they 
did  in  1908,  by  a  lack  of  demand  for  hides  and  wool,  and 
simultaneously  for  an  insufficient  outlet  for  meats. 

The  dried-meat  f'saladeros)  industry,  which  used  to  absorb 
annually  nearly  two  million  beasts,  has  by  now  been  almost 
entirely  removed  in  the  direction  of  Uruguay,  or  the  Brazilian 
province  of  Rio  Grande  do  Sul,  and  is  little  more  than  a 
memory ;  as  this  primitive  and  rudimentary  method  of  pre- 
paration had  perforce  to  give  way  before  the  more  hygienic 
and  progressive  chilled  and  frozen  meat  trade.  The  chilled 
beef  industry,  however,  upon  which  such  hopes  were  founded, 
has  not  of  late  years  made  any  conquest  of  new  markets, 
England  being  almost  the  Republic's  only  customer. 

As  for  the  exportation  of  cattle  on  the  hoof,  it  is  greatly 
impeded  in  Europe  by  prohibitive  measures,  which  diplomacy, 
by  means  of  commercial  treaties,  is  endeavouring  to  remove. 
Yet  were  the  desired  advantages  obtained,  the  result  would 
be  doubtful  on  account  of  the  considerable  rise  in  the  price 
of  cattle  and  the  high  freights  which  are  charged  for  the 
transport  of  living  stock.  It  therefore  results  that  this  parti- 
cular species  of  exploitation  is  at  an  obvious  disadvantage  in 
the  face  of  the  refrigerating  trade. 


xviii     THE  ARGENTINE  IN  THE  20th  CENTURY 

If  the  raising  of  stock  and  its  dependent  industries  have 
not,  in  these  last  few  years,  realised  a  progress  comparable 
to  that  of  agriculture,  we  must  by  no  means  conclude  that 
this  department  of  production  has  ceased  to  be  an  element 
of  national  prosperity.  Quite  on  the  contrary :  thanks  to 
the  efforts  made  to  better  affairs  by  happy  selections  in  the 
breed  of  animals,  the  value  of  live  stock  has  increased  in 
surprising  proportions,  and  the  Argentine  still  retains  its 
rank  as  second  to  the  United  States  as  a  stock-raising 
country. 

What  we  have  endeavoured  to  emphasise,  as  a  new  mani- 
festation of  the  national  activity  during  the  last  few  years, 
is  that  the  development  of  the  country  has  been  in  especial 
along  agricultural  lines ;  an  incontestable  proof  of  progress, 
and  an  index  of  a  higher  degree  of  civilisation. 

Agriculture,  as  compared  to  stock-raising,  is,  from  the 
economical  point  of  view,  a  source  of  wealth  having  quite  a 
different  bearing  upon  the  general  prosperity  and  welfare  of 
a  nation.  It  is  the  fairy  which  little  by  little  transforms  the 
vast  plains  of  the  Argentine  pampas  into  a  more  animated 
landscape,  peopled  by  numerous  homesteads,  foci  of  colonisa- 
tion, which  then  develop  into  villages,  which  in  a  score  of 
years  may  perhaps  be  important  cities.  Agriculture  summons 
the  railroad,  stimulates  emigration,  promotes  the  division  of 
the  soil,  creates  the  small  proprietor ;  it  influences  even  the 
manners  and  morals  of  the  inhabitants,  for  it  demands  more 
labour,  more  intelligence  than  ranching  ;  nimbler  wits,  more 
method,  greater  foresight. 

The  comparison  between  the  two  great  industries  of  the 
Argentine  is  summed  up  in  the  following  fact :  a  property 
comprising  25,000  acres  of  pasture  can  be  put  into  work- 
ing order  and  managed  by  a  staff  of  ten  to  twelve  men. 
For  an  estate  of  1500  acres  under  culture,  one  may  estimate 
that  forty  to  fifty  persons,  grouped  in  families,  may  easily  live 
upon  the  soil  and  prosper.  We  may  perceive  by  this  the 
great  superiority  of  agriculture  from  the  point  of  vieM'  of  the 
general  interest  of  the  country.  It  demands  and  supports  a 
denser  population ;  it  permits  the  grouping  of  this  population 
in  villages  and  cities,  it  creates,  in  proportion,  with  a  smaller 
capital,  a  great  wealth  of  produce  :  in  short,  it  contributes  on 


AUTHOR'S  PREFACE  xix 

the  one  hand  towards  increasing  the  wealth  of  the  country 
by  participating  largely  in  its  exports,  and  on  the  other  it 
increases  its  power  of  consumption,  by  absorbing  a  greater 
number  of  imported  products. 

Thus  the  evolution  of  the  Argentine  towards  agriculture 
constitutes  a  real  progress,  and  if  the  country  continues  to 
follow  the  same  path,  its  development  will  assuredly  not  be 
arrested  by  lack  of  soil.  The  35  to  37  millions  of  acres 
already  reclaimed,  and  at  present  under  culture,  represent  at 
the  most  a  tenth  of  the  total  area  of  cultivable  land,  which  is 
estimated  roughly  at  375  millions  of  acres,  of  which  at  least 
125  millions  are  perfectly  adapted  to  the  culture  of  cereals. 
The  four  Provinces  of  Buenos  Ayres,  Santa  Fe,  Cordoba, 
Entre  Rios,  and  the  Territory  of  Pampa  Central  alone 
contain  some  32i  millions  of  land  under  the  plough, 
while  there  remains  about  170  millions  of  acres  of  land 
which  is  just  as  fertile,  and  which  without  manuring  or 
preparation  would  yield  a  splendid  crop  from  the  first  year 
of  tilth. 

This  transformation  into  an  agricultural  country  has 
already  borne  fruit.  The  figures  relating  to  external  com- 
merce, compared  with  the  world's  statistics  of  cereal  produc- 
tion, show  the  present  position  of  the  Argentine  among  the 
great  ex-porting  nations. 

It  is  the  Argentine  which  to-day,  after  the  United  States, 
occupies  the  second  rank  in  the  matter  of  cereal  exports ; 
and  this  is  a  significant  event  in  the  economic  history  of  the 
nations,  to  which  the  attention  of  Europe  should  be  directed. 
At  the  present  moment  the  Argentine,  with  her  4  million 
tons  of  corn  available  for  exportation,  is  not  as  yet 
mistress  of  the  grain  markets,  but  she  represents,  to  those 
countries  whose  production  is  insufficient,  a  notable  reserve, 
which  has  become  indispensable  since  the  United  States, 
Canada,  and  Russia  seem  to  have  reached  their  limit  of 
exportation. 

The  year  1907-8  was  for  the  Argentine,  thanks  to 
the  results  of  a  good  harvest,  a  period  of  exceptional 
prosperity.  The  average  yield  of  wheat  was  18-7  cwt.  per 
hectare — 14  bushels  per  acre — and  in  the  Province  of  Buenos 
Ayres  it  amounted  to  over  a  ton  per  hectare — or  15  bushels  per 


XX       THE  ARGENTINE  IN  THE  20th  CENTURY 

acre — although  the  average  was  only  11  per  acre  in  1906- 
1907,  and  13  in  1905-1906. 

As  for  the  prices,  they  ruled  higher  than  any  the 
country  had  so  far  known,  even  during  its  most  prosperous 
periods.  Wheat  had  been  selling  at  6  or  7  piastres  the  100 
kilos — that  is,  approximately,  at  3s.  to  3s.  6d.  per  bushel — and 
at  that  price  agriculture  still  yielded  a  fair  profit.  In  1908, 
as  a  result  of  the  bad  harvests  in  several  European  countries, 
the  sales  rose  to  6s. ;  at  which  price  the  profits  on  the  cost  of 
production  amounted  to  2-5  %  or  30  %. 

After  this  cursory  glance  at  the  present  situation  in  the 
Argentine,  we  must  also  express  our  views  of  the  future. 
Optimism  is  certainly  permissible  in  the  case  of  a  country 
which  has  advanced  so  far  in  so  short  a  time,  and  where  pros- 
perity is  founded  on  a  diversity  of  products  which  can  never 
be  affected  by  a  universal  crisis. 

However,  one  well  might  wonder  whether  the  Argentine 
might  not,  in  the  Biblical  phrase,  know  lean  years  following 
the  fat ;  whether  she  is  not  destined  to  sufi'er  the  onset  of 
plagues,  such  as  drought  and  the  locust,  which  latter  is  to 
her,  as  to  Egypt  in  the  time  of  the  Israelites,  a  veritable 
scourge.  Certainly  here  we  have  one  of  the  great  risks  to 
which  the  country  is  exposed  :  a  country  wherein  all  depends 
upon  the  harvest,  the  earth  being  the  principal  source  of 
wealth,  and  the  mother  of  all  industry.  Yet  this  danger,  so 
real  a  few  years  ago,  is  greatly  lessened  to-day  by  the  fact  of 
the  distribution  of  cultivated  lands  and  pastures  over  a  far 
greater  area.  A  bad  harvest  could  not  compromise  both 
agriculture  and  stock-raising  over  a  stretch  of  more  than  15° 
of  latitude. 

Yet  the  country  is  subject  to  a  very  real  danger,  but  one  of 
another  kind.  From  the  very  exuberance  of  development  may 
arise  a  crisis  of  growth  ;  for  her  prosperity  depends  not  only 
on  plentiful  harvests ;  it  may  be  influenced  by  other  factors 
on  which  it  is  far  more  difficult  to  pronounce. 

The  country  must  continue  to  require  considerable  sums 
of  capital  for  her  agricultural  necessities,  for  her  stock-rais- 
ing, for  commerce,  and  for  industries  ;  and  it  may  be  asked 
whether  the  European  markets,  from  which,  in  great  measure, 
her  capital  derives,  can  continue  to  afford  her  an  ever-increas- 


AUTHOR'S  PREFACE  xxi 

ing  amount  of  assistance  which  will  keep  pace  with  her 
development  in  all  directions. 

The  Argentine  is  not  so  far  self-sufficing.  The  soil  is,  to 
be  sure,  a  source  of  immense  national  wealth,  but  this  wealth 
is  not  in  the  form  of  a  reserve  to  be  drawn  on  ;  it  is,  as  a  rule, 
converted  into  real  estate  directly  it  is  produced;  unless, 
indeed,  it  goes  abroad.  For  a  farmer  who  makes  a  profit, 
say,  of  £8000  or  £10,000,  will  immediately  employ  his  capital 
to  acquire  another  holding  or  to  start  a  different  kind  of 
culture,  instead  of  clearing  off  the  debts  which  already 
burden  his  property.  He  is  contented  with  his  position  as  a 
borrower ;  for  if  money,  even  on  mortgage,  costs  him  8  to  9 
per  cent.,  he  can,  on  the  other  hand,  obtain  a  far  higher 
interest  by  sinking  it  in  the  purchase  of  land. 

From  all  this  it  results  that  in  the  Argentine  rural  and 
even  urban  property  is  largely  hypothecated.  It  must  be 
understood  that  this  capital  is  well  guaranteed,  as  its  security 
rests  not  upon  pure  speculations  but  on  the  yield  of  the 
property,  which  is  far  in  excess  of  the  charges ;  however, 
since  the  general  tendency  is  not  towards  redemption,  one 
may  wonder  if,  sooner  or  later,  there  may  not  be  a  lack  of 
equilibrium  between  the  impulse  given  to  the  country  and  its 
financial  needs.  The  crisis  which  arose  in  the  wool  market 
in  1908,  the  drop  in  the  prices  of  quebracho  timber,  and  the 
restricted  outlet  for  cattle  on  the  hoof,  and  even  for  refriger- 
ated meat, — all  these  partial  misfortunes  are  salutary  warn- 
ings, and  we  must  not  lose  sight  of  them,  nor  allow  ourselves 
to  be  hypnotised  by  the  high  prices  of  wheat,  maize,  or  flax, 
or  the  heavy  yield  of  the  lucerne  pastures. 

For  our  part,  in  considering  the  future  of  the  Republic 
no  less  than  its  present  interests,  we  hope  to  see  it  enter  upon 
a  period  of  consolidation,  rather  than  continue  indefinitely 
the  discussion  of  further  progress.  Before  entering  upon 
another  stage  of  development  the  country  must,  for  a 
while,  mark  time,  in  order  to  gain  leisure  to  assume  its  own 
liabilities,  rather  than  continue  incessantly  to  absorb  new 
capital. 

But  there  is  still  a  cloud  in  the  serene  skies  of  the 
Republic;  a  cloud  that  might  be  the  precursor  of  a  truly 
national  catastrophe,  if   the  measures  necessary  to  avert  it 


xxii     THE  ARGENTINE  IN  THE  20th  CENTURY 

were  not  taken  in  time.  The  peril  arises  neither  from  the 
economic  situation,  which  is  excellent,  denoting  an  ever- 
increasing  vitality,  nor  the  relations  of  the  Republic  with 
the  neighbouring  nations,  which  are  conceived  in  a  spirit 
of  peace  and  concord.  Although  a  short-sighted  diplomacy 
has  attempted  to  envelop  the  relations  between  the  Argentine 
and  Brazil  in  an  atmosphere  of  jealous  distrust,  there  is  no 
fundamental  cause  which  might  trouble  the  friendly  relations 
of  these  two  countries,  which  formerly  fought  side  by  side 
on  the  field  of  battle  for  the  redemption  of  a  sister  nation. 
They  have  no  conflicting  economic  interests  which  might 
divide  them,  and  are  destined  to  afford  a  great  example  of 
progress  and  of  civilisation  to  the  other  States  of  South 
America. 

The  peril  to  which  we  refer  is  of  a  totally  different 
character:  it  is  caused  exclusively  by  the  exaggerated 
expenditure  of  the  public  administrations,  and  the  dangerous 
paths  of  armed  peace  upon  which  the  country  has  entered  ; 
thus  implanting,  in  young  and  free  America,  a  ruinous  system, 
which  is  ruining  the  nations  of  the  Old  World,  burdens  them 
with  insufferable  taxes,  and  diverts  from  production  and 
labour  too  large  a  proportion  of  citizens.  In  order  to  face 
imaginary  dangers,  Congress  and  the  Government  have  lately 
decreed  that  a  sum  of  £40,000,000  shall  be  expended  upon 
armaments. 

As  for  home  politics,  they  form  a  domain  which  we  do  not 
desire  to  enter,  and  on  which  the  world  of  affairs  bestows 
little  enough  attention,  so  long  as  they  do  not  compromise 
the  public  peace.  The  Argentine,  in  fact,  is  still  under  a 
system  of  personal  power ;  the  Presidency  of  the  Republic 
is  the  focus  about  which  all  the  political  life  of  the  country 
gravitates.  In  default  of  a  people  as  conscious  of  its  rights 
as  of  its  duties,  and  possessed  of  the  virtues  necessary  to 
a  course  of  perseverance  in  democratic  practices,  it  is  the 
Government  that  manages  the  elections;  and  it  is  difficult  to 
say  whether  it  does  so  because  there  is  no  public  opinion,  or 
whether  there  is  no  public  opinion  because  the  Governments 
usurp  the  functions  of  the  electorate.  From  this  point  of 
view  there  has  been  no  change  in  the  political  morale  of 
the  country ;  the  only  progress  to  be  noted  is  that  tlie  parties 


AUTHOR'S  PREFACE  xxiii 

resort  less  often  than  they  used  to  violence  as  a  solution  of 
their  quarrels. 

As  for  the  administrative  expenses,  they  are  increasingr 
with  a  rapidity  only  equalled  by  the  growth  of  the  fiscal 
resources  of  this  fortunate  country.  Proposals  for  public 
works  accumulate  in  the  various  Ministries,  while  waiting  for 
the  funds  necessary  for  their  execution ;  their  total  amounts 
to-day  to  the  respectable  figure  of  nearly  £40,000,000. 

To  sum  up:  from  our  re-examination  of  the  Argentine 
situation  for  1909,  we  obtain  an  impression  of  great  progress 
and  of  actual  prosperity,  an  impression  confirmed  by  the 
statistics  of  foreign  trade,  in  which  the  entire  activity  of 
the  country  is  reflected.  For  the  year  1907  the  total  of 
imports  and  exports  amounted  to  £116,000,000;  for  1908 
the  total  receipts  and  outgoings  represented  £183,000,000 : 
with  a  commercial  balance  of  nearly  £24,000,000  in  favour 
of  exports. 

Among  the  other  manifestations  of  national  progress  we 
have  still  to  take  into  account  the  development  of  the 
network  of  railroads,  of  which  13,660  miles  are  in  actual 
working,  representing  a  capital  of  £158,000,000,  while  3259 
miles  are  projected  or  in  process  of  construction,  representing 
a  capital  of  more  than  £25,000,000.  These  new  lines  have 
been  conceded  by  Congress  either  to  companies  already 
existing,  or  to  new  companies  which  are  able  to  offer  all 
desirable  guarantees,  so  as  to  assure  the  prompt  realisation 
of  the  schemes  accepted.  The  Government,  on  its  own  part, 
has  solicited  and  obtained  from  Congress  the  necessary 
sanction  for  the  execution  of  a  vast  plan  for  the  colonisation 
of  the  Southern  Territories,  which  is  based  on  the  construction 
of  numerous  railroads.  This  continuous  extension  of  the 
railway  system  has  greatly  favoured  the  valorisation  of  the 
new  Territories,  and  has  contributed  powerfully  to  the 
movement  of  colonisation  and  emigration  which  is  the  in- 
dispensable condition  of  a  wider  future. 

To-day,  then,  all  is  for  the  best  in  the  best,  or  at  least  the 
richest,  country  in  the  world.  But  if  science  teaches  us  that 
Nature  takes  no  leaps — natura  non  facit  saltus — history 
also  teaches  us  that  nations  in  their  progress  must  not 
progress    too    rapidly.       For    this    reason    the     Argentine 


xxiv      THE  ARGENTINE  IN  THE  20th  CENTURY 

Republic,  in  especial,  has  need  to-day  to  consolidate  her 
prosperity  under  a  regime  of  foreign  and  domestic  peace,  of 
prudence  and  economy,  and  to  avoid  speculation  and  the 
abuse  of  credit,  which  have  ended,  before  now,  in  inevitable 
reaction. 


PREFACE   TO   THE    FIRST   EDITION. 

TWENTY  years  ago  M.  F.  Latzina,  Director  of  Statistics, 
published  in  French  a  very  able  work  on  the  Geographie 
de  la  R^puhlique  Argentine,  of  which  he  had  issued  the  first 
edition  in  Spanish,  and  I  consented  with  pleasure  to  write 
an  Introduction  to  a  book  whose  object — an  object  which  it 
fulfilled — was  to  familiarise  European  readers  with  a  country 
whose  rapid  development  is  one  of  the  most  remarkable 
facts  in  the  economic  history  of  the  nineteenth  century. 

"These  results,"  I  wrote,  after  having  quoted  certain 
statistics  of  agriculture  and  commerce,  "  are  assuredly  very 
satisfactory.  The  Argentines  have  the  right  to  be  proud  of 
them  ;  few  countries  in  the  world  could  show  a  like  example 
of  progress ! " 

I  have  no  less  pleasure  in  associating  myself  to-day  with 
this  book,  by  Senor  Albert  B.  Martinez  (sometime  Under- 
Secretary  of  State,  and  at  present  Director-General  of  the 
Statistical  Department  of  the  city  of  Buenos  Ayres),  and  M. 
Maurice  Lewandowski,  Sub-Director  of  the  Comptoir  National 
d'Escompte  of  Paris.  Their  competence  is  incontestable, 
and  their  work  requires  no  recommendation,  since  it  has 
won  the  sanction  of  success,  being  now  in  its  third  French 
edition,  and  having  been  "  crowned  "  by  the  French  Academy. 
But  the  object  which  is  aimed  at  by  The  Argentine  in  the 
Nineteenth  Century  is  the  same  as  that  of  the  Geographie  de 
Id  Rdpuhlique  Argentine,  and  the  interest  attaching  to  the 
book  is  the  same. 

"In  the  competition  of  the  new  nations,  created  by 
emigration  from  Europe,"  I  said  in  1890,  "this  Republic  will 
be  enjoying  a  privileged  situation^  because  of  its  particular 
advantages :  the  nature  of  its  climate — a  climate  of  the 
temperate  zone ;  the  vast  extent  of  its  territory ;  the  quality 
of  its  soil ;  the  facility  M'ith  which  railways  can  be  built ; 
its  situation  on  the  Atlantic  coast,  facing  Europe,  and  rela- 


xxvi    THE  ARGENTINE  IN  THE  20th  CENTURY 

tively  near  the  Indian  Ocean  ;  the  powerful  tide  of  emigra- 
tion setting  in  towards  it,  and  the  rapid  peopling  of  the 
country,  together  with  the  wealth  that  results  therefrom  ;  the 
suitable  character  of  its  population,  and  the  liberal  spirit  of 
its  political  institutions.  .  .  . 

"  The  Argentine  Republic,  which  occupies  in  the  temperate 
zone  of  South  America  a  position  analogous  to  that  held  by 
the  United  States  in  the  corresponding  portion  of  North 
America,  may  well  dream,  if  not  of  equal  power,  at  least  of 
a  similar  future." 

This  dream  is  in  process  of  realisation :  of  this  the  proof 
will  be  found  in  the  chain  of  evidence  which  our  authors  put 
forward. 

It  is  the  present  condition  of  affairs  and,  above  all,  the 
economic  situation,  which  the  authors  of  The  Argentine  in 
the  Twentieth  Century  have  set  out  to  represent.  They 
have  not  given  us  a  panegyric — '^  nihil  admirari,^'  say  they 
— but  a  practical  book  ;  one  written  by  men  of  business  and 
affairs,  founded  upon  direct  observation,  and  hard-and-fas 
figures,  where  statistics  have  provided  them. 

The  Argentine  is  a  young  nation,  which  hitherto  has 
busied  itself  rather  in  work  and  production  for  the  ameliora- 
tion of  its  present  condition,  and  in  the  preparation  of  its 
morrow  by  creating  capital,  than  in  giving  itself  to  the 
historical  study  of  its  past.  Nevertheless,  history  is  the 
web  from  which  the  spirit  of  a  nation  is  woven.  It  is  useful 
to  recall  the  principal  historical  periods,  and  particularly  the 
origins  of  the  nation,  for  the  better  understanding  of  the 
present  period. 

It  was  in  1508  that  the  Spaniard,  Juan  Diaz  de  Solis, 
discovered  the  estuary  of  the  Plata,  the  Mar  dulce ;  and  in 
1516  he  returned,  thinking,  after  the  discovery  of  the  South 
Sea,  by  Nuuez  de  Balboa  in  1513,  that  this  might  be  the 
strait,  so  sought  by  the  navigators  of  the  time,  bj^  which  that 
sea  might  be  reached,  but  on  landing  he  was  killed  by  the 
arrows  of  the  Charrua  Indians.  He  had  discovered  no 
strait,  but  a  spot  assuredly  well  suited  for  colonial  settle- 
ment. The  first  attempts  were  abortive :  that  of  Sebastian 
Cabot,  who  built  the  fort  of  the  Sancti-Spiritu  (1527),  and 


PREFACE  TO  FIRST  EDITION  xxvii 

that  of  Diego  Garcia.  It  was  then  that  the  discovery  of 
some  ornaments  of  silver,  worn  by  the  people  of  the  country, 
gave  the  river  its  name ;  known  first  as  the  Rio  de  Solis, 
it  was  now  called  the  Rio  de  la  Plata.  The  Indians  destroyed 
the  fort  and  killed  the  colonists. 

Eight  years  later  a  wealthy  private  gentleman,  an  officer 
of  Charles  V,,  Don  Pedro  de  Mendoza,  undertook  to  establish 
a  settlement  at  his  own  cost,  on  the  condition  of  being 
appointed  governor  of  all  territories  that  might  be  found 
as  far  as  200  leagues  from  the  ocean;  and  in  1535  he  sailed 
with  fourteen  vessels  and  two  thousand  men.  He  laid  the 
first  foundations  of  the  colony  of  Buenos  Ayres,  and  he 
rebuilt  the  fort  of  the  Sancti-Spiritu,  while  his  lieutenant, 
Ayolas,  in  1536,  founded  the  station  of  Asuncion,  on  the 
Rio  Paraguay.  The  post  of  Buenos  Ayres  was  abandoned. 
After  the  death  of  Mendoza  and  Ayolas  the  new  colony  was 
governed  by  Martinez  de  Irala  for  a  space  of  nearly  twenty 
years ;  reinforced  by  fresh  emigrants,  it  barely  held  its  own 
against  the  losses  inflicted  upon  it  by  the  Indians.  Irala, 
by  a  voyage  of  three  years'  duration,  succeeded  in  putting 
himself  in  touch  with  the  Spaniards  of  Peru. 

Conquerors  coming  from  Chili  across  the  Andes,  the 
Spaniards  founded  among  others,  despite  the  hostility  of 
the  Indians,  the  following  stations :  Santiago  del  Estero 
(1552),  Mendoza  (1560),  Tucuman  (1565),  Cordoba  (1573), 
Salta  (1582),  and  Jujuy  (1592).  These  at  first  were  little 
more  than  camps  entrenched.  But  Santiago  del  Estero  was 
erected  into  a  bishopric,  and  so  remained  until  1700,  in 
which  year  the  episcopal  throne  was  transferred  to  Cordoba. 
In  the  eastern  regions,  in  1573,  Governor  Juan  de  Garay 
built  Santa  Fe,  re-occupied  Buenos  Ayres,  which  was 
christened,  on  the  11th  of  June  1580,  Cuidad  de  la  Trinidad 
y  Puerto  de  Santa  Maria  de  Buenos  Ayres  (the  City  of  the 
Trinity  and  the  Haven  of  Holy  Mary  of  the  Fair  Winds), 
and  founded  Corrientes  in  1588. 

Trade  commenced.  A  first  consignment  of  hides  and 
sugar  was  dispatched  to  Spain  in  1551  ;  but  the  merchants 
of  Seville  protested,  and  as  a  result  their  privileges  won  the 
day.  It  is  a  fact  that  the  monstrous  regulations  which  Spain 
had  imposed  upon  her   colonies  forced  the   Argentines,   for 


xxviii    THE  ARGENTINE  IN  THE  20th  CENTURY 

some  considerable  time  to  carry  their  exports  across  the 
continent  to  Callao,  whence  they  were  carried  by  sea  to 
Panama  ;  there  they  were  again  transported  by  land  across 
the  isthmus,  and  were  shipped  anew  at  Puerto  Bello  for 
Seville.     Imports  came  by  the  same  road. 

There  were,  however,  exceptions  to  this  rule :  either  by 
grace  of  provisional  permits  given  by  the  King  of  Spain,  or, 
more  frequently,  through  the  contraband  trade. 

In  1617  the  Province  of  Paraguay  and  the  shores  of  the 
Plata  were  divided  into  three  Provinces ;  Paraguay,  Buenos 
Ayres  (erected  into  a  bishopric  in  1630),  and  Tucuman,  which 
were  dependents  of  the  viceroyalty  of  Peru.  The  captaincy 
of  Chili  also  extended  over  both  sides  of  the  Andes.  The 
Indians  had  to  a  great  extent  been  divided  among  the 
colonists  en  encomiendas — that  is  to  say,  in  a  species  of 
slavery ;  but  other  Indians,  who  were  still  free,  were  formidable 
enemies. 

Early  in  the  seventeenth  century  the  Jesuits  instituted 
their  first  "  reductions "  in  Paraguay,  and  organised  in  a 
community  the  Guarano  Indians  of  the  country.  These  "  re- 
ductions," ravaged  by  the  Mamelukes  of  Brazil,  were  replaced 
by  missions  established  on  either  bank  of  the  Paraguay 
River,  and  on  the  Uruguay  to  the  south  of  Yguassu.  The 
order  of  Jesuits  was  suppressed  in  1766. 

The  principal  towns  of  the  Argentine  of  to-day  were 
already  established  by  the  middle  of  the  eighteenth  century. 
At  that  period,  so  Savary  informs  us,  "  The  city  of  Buenos 
Ayres  contained  about  4000  houses,  all  built  of  earth  (adobe), 
but  covered  with  tiles,  with  the  exception  of  some  lifty 
houses  of  brick.  The  inhabitants  are  rich,  and  owe  their 
riches  to  the  extensive  trade  which  they  carry  on,  both  at 
home  and  abroad."  After  the  advent  to  the  Spanish  throne 
of  the  son-in-law  of  Louis  XIV.,  France  had  the  greater  share 
of  this  trade ;  the  King  having  conceded  to  a  French  com- 
pany the  monopoly  of  the  Assiente — that  is  to  say,  of  the 
trade  in  negroes,  until  by  the  Treaty  of  Utrecht  France  was 
forced  to  cede  this  monopoly  to  England. 

The  two  principal  articles  of  export  were  at  that  time 
green  hides  for  Europe  and  the  Paraguayan  TJiatd  for  Peru. 

On  the  northern  bank  of  the  Plata  the  Portuguese  had 


PREFACE  TO  FIRST  EDITION  xxix 

founded  the  Colonia  del  Sacramento  (1686),  with  a  view  to 
competing  with  the  Spanish  ports.  The  Spaniards  seized 
this  place  once  in  1724  and  again  in  1766  ;  they  founded 
Montevideo  in  1726.  The  quarrel  between  the  two  colonies 
was  only  terminated  by  the  Treaty  of  Madrid  in  1750. 

In  1748  Spain  somewhat  abated  the  severity  of  her  laws. 
In  1776  she  freed  the  Argentine  from  the  overlordship  of 
Peru,  by  creating  the  viceroyalty  of  La  Plata,  with  Buenos 
Ayres  as  capital.  The  population,  which  before  this  change 
was  only  37,000,  rose  to  over  400,000  in  a  quarter  of  a  century. 
In  1780  was  founded  the  colony  of  Carmen,  the  first 
Patagonian  settlement,  the  shores  of  Patagonia  having  been 
first  explored  by  the  Jesuit  Quiroga  in  1746. 

During  the  wars  of  the  Empire  the  English  seized  Buenos 
Ayres  by  surprise,  but  were  expelled  by  a  Frenchman,  Jacques 
de  Liniers,  whom  the  inhabitants  had  appointed  viceroy. 

The  colonial  period  ended  in  1810. 

Such  were  the  origins  of  the  Argentine ;  a  time  of 
difficulties  and  impediments  ;  but  in  that  period  were  laid 
the  foundations  on  which  the  Argentine  civilisation  reposes. 

The  second  period  is  that  of  the  formation  of  the  Re- 
publican State. 

The  first  part  of  this  period,  that  of  the  deliverance  from 
Spain,  opens  with  the  memorable  day  of  the  25th  of  May 
1810,  when  liberty  was  peacefully  proclaimed  at  Buenos 
Ayres.  The  revolution  spread  to  C6rdoba  and  to  Tucuman 
it  failed  in  Upper  Peru,  owing  to  the  reverse  of  Goyen^che 
in  1811,  and  in  Paraguay,  where  the  capitulation  of  Tacuary 
took  place  in  the  same  year.  Belgrano,  one  of  the  heroes  of 
the  War  of  Independence,  renewed  the  ofiensive  and  once 
more  invaded  Upper  Peru — this  time  victoriously  ;  but  the 
Argentine  troops  were  definitely  driven  from  the  country 
after  the  battles  of  Vilcuapujio  (1813),  and  Sip^-Sipe  (1816). 
On  the  east  coast  the  capitulation  of  Montevideo  in  1814  put 
an  end  to  the  Spanish  domination.  On  the  west  the  brilliant 
expedition  of  General  San  Martin,  who  crossed  ^he  Andes, 
freed  Chili,  and  struck  the  decisive  blow  by  the  capture  of 
Lima  (1817-1821).  The  victory  of  General  Sucre  at  Ayacucho 
(1824)  terminated  the  struggle.  Argentine  territory  had 
already  been  seven  years  free  from  the  Spanish  troops, 
c 


XXX       THE  ARGENTINE  IN  THE  20th  CENTURY 

The  second  part  of  this  period,  that  of  political  con- 
struction, was  longer,  far  more  laborious,  and  still  more 
bloody.  Questions  of  race  and  party  divided  the  inhabitants 
Guachos  of  the  Pampa,  Creoles  *  and  pure  Spaniards,  Federals 
and  Unitarians, disputed  the  power,  while  on  the  frontiers  of 
the  Republic  the  Indians  continued  to  disturb  and  alarm  the 
new  State.  Provinces  seceded ;  many  constitutions  were 
drafted.  In  spite  of  his  talen  as  a  statesman,  Rivadavia 
was  unable  to  obtain  the  universal  acceptance  of  the  Unionist 
Constitution  of  24th  December  1826. 

A  war  against  Brazil,  of  which  the  notable  fact  was  the 
victory  of  Ituzaingo  (1827),  resulted  in  the  recognition  of 
Uruguay  as  a  free  state. 

The  civil  war  broke  out  anew  several  times.  The  military 
leader  of  the  Buenos  Ayres  Federals,  General  Rosas,  seized 
upon  the  dictatorship  in  a  time  of  disorder,  exercising  it 
not  without  intelligence,  but  with  a  cruel  despotism,  and 
he  carried  on  a  long  war  against  Montevideo,  which  lasted 
until  General  Urquiza,  of  the  Union  party  (with  Brazil  and 
Uruguay  as  allies)  delivered  his  country  by  the  victory  of 
Caseros  (1852).  The  Constitution  of  the  Argentine  Re- 
public was  voted  on  25th  May  1853  ;  but  the  end  of  the  civil 
war  and  the  definite  reunion  of  Buenos  Ayres  to  the  other 
Provinces  did  not  take  place  until  1860,  the  year  of  the 
revision  of  the  Constitution. 

War  and  confusion  are  not  usually  propitious  to  progress. 
However,  the  population  in  1861  was  estimated  approxi- 
mately at  1,375,000  ;  it  had  increased  to  almost  five  times 
what  it  was  at  the  beginning  of  the  century. 

Buenos  Ayres  became  definitely  the  capital  of  the 
Republic  in  1882,  upon  ceasing  to  be  the  capital  of  the 
State  of  Buenos  Ayres. 

The  third  period  is  that  of  economic  development.  This 
is  the  period  of  which  our  authors  write.  We  may  mention 
it  as  beginning  with  the  re-entrance  of  Buenos  Ayres  into 
the  Argentine  Concert,  and  the  revision  of  the  Constitution 
of  October  1860.  If  it  has  not  been  free  from  political 
acritations  and  international  misunderstandings,  it  has  none 

*  This  word  is  here  used  to  denote  mixed  blood ;  in  its  proper  use  it  denotes 
a  person  of  Latin  blood  born  in  tropical  or  semi-tropical  America.  —  [Trans.] 


PREFACE  TO  FIRST  EDITION  xxxi 

the  less  beon  more  pacific  than  the  preceding  periods,  and 
industry  has  enjoyed  a  security  which  in  former  years 
was  only  too  often  disturbed  by  the  regulations  of  colonial 
trade,  the  attacks  of  the  Indians,  the  civil  wars,  and  the 
Separatist  policy.  But  there  were  still  for  twelve  years 
intestine  troubles  and  dissensions. 

It  was  only  in  1882  that  the  political  organisation  was 
completely  constituted,  when  Buenos  Ayres  became  the 
Federal  capital ;  for  from  I860  to  1870  the  Argentine  was 
forced  to  wage  war  against  Paraguay,  when  it  struggled, 
in  concert  with  Brazil,  against  the  despotism  of  Lopez.  The 
Treaty  of  the  3rd  of  February  1876  gave  it  the  greater 
Chaco  as  far  as  Pilcomayo.  The  Chaco  is  pacified ;  matters 
are  not  the  same  now  as  when,  in  1881,  Crevaux  was 
assassinated  there  by  the  Tobas.  General  Riva  efiected  the 
Argentine  conquest  of  Patagonia  (1879-1880),  and  the  Indians, 
feared  so  long  by  the  planters,  w^ere  driven  across  the  Andes. 

In  1895  the  difference  which  had  arisen  between  the 
Argentine  and  Brazil,  with  reference  to  the  J^Iisiones  frontier, 
was  settled  by  arbitration.  By  the  Treaty  of  23rd  July  1881 
was  terminated  a  long  quarrel  with  Chili  in  relation  to 
Patagonia ;  the  Argentine  obtained  possession  of  the  country 
as  far  as  the  line  made  by  the  Cordilleras  and  a  portion  of 
Tierra  del  Fuego.  Arbitration  also,  in  November  1902, 
settled  the  difference  with  Chili,  no  less  irritating  and  of 
equally  long  standing,  concerning,  the  frontiers  of  the 
Andes.  No  more  serious  causes  of  quarrel  between  the 
Arcrentine  and  its  neighbours  remain.  ^ 


The  period  of  economic  development  is  as  yet  of  only  fifty 
years'  duration :  it  is  far  from  having  reached  the  limit  of 
its  evolution;  but  we  may  judge  of  the  amplitude  which  that 
evolution  has  already  attained  by  means  of  statistics,*  and 
by  them  we  may  foretell  what  the  future  holds  in  promise. 

The  population,  estimated  in  1861  as  being  1,375,000,  had 
by  1907  increased  to  6,210,000.  Immigration,  varying  from 
one  period  to  another  according  to  the  economic  condition  of 

*  The  more  recent  figures  cited  in  this  Preface  are  taken,  for  the  most  part, 
from  The  Statesman's  Year-Booh. 


xxxii     THE  ARGENTINE  IN  THE  20th  CENTURY 

the  European  nations  and  the  Argentine  Republic,  reached 
an  annual  average  of  13,400  from  1860  to  1869  :  between  1903 
and  1908  it  amounted  to  211,000  (emigration  not  being 
deducted.)* 

The  area  cultivated  in  1895,  the  date  of  the  first  serious 
estimate,  was  5,256,160  acres,  of  which  2,013,000  acres  were 
under  wheat ;f  in  1909  346  million  acres  were  cultivated, 
of  which  14-8  millions  were  in  wheat.  These  34-6  millions 
are  only  a  small  fraction  of  the  256  million  acres  which  the 
Argentine  appears  to  contain. 

The  grain  harvest,  estimated  in  1878-1881  at  barely 
400,000  tons,  exceeded  a  million  tons  in  1895,  and  in 
1907-1908  amounted  to  5,523,900  tons,  or  204,384,000  bushels. 

Although  the  bovine  and  ovine  races  have  not  greatly 
increased  in  numbers  for  the  last  twenty  years,  on  account 
of  the  transformations  effected  by  agriculture,!  the  exporta- 
tion of  wool,  which  was  660,000  quintals  in  1869-1870,  was 
nearly  2,000,000  in  1905,  and  it  still  amounted  to  1^  millions 
in  1907  ;  the  exportation  of  beef,  reckoned  in  carcasses,  was 
more  than  66,000  head  in  1900  and  463,000  in  1907. 

The  first  section  of  railroad  was  constructed  in  1857.  In 
1865  the  Republic  possessed  only  154  miles  of  railroad ;  in 
1908  there  were  14,643  miles. 

In  1865,  the  first  year  of  which  we  have  commercial 
statistics,  the  foreign  trade  amounted  to  £11,300,000  ;  in 
1907,  it  reached  £113,000,000,  and  in  1908  £127,600,000.  For 
several  years  there  has  been  a  very  large  excess  of  exports 
over  imports;  in  1908  it  would  seem  to  have  exceeded 
£20,000,000. 

These  figures,  to  which  our  authors  have  added  many 
others,  are  eloquent.  They  tell  us  that  man,  whose  labour 
creates  wealth,  is  four  and  a  half  times  more  numerous 
upon  Argentine  soil  than  he  was  forty-six  years  ago ;  that 
immigration    each  year   increases  the  number  of  workers ; 

*  This  emigration  amounted  to  an  annual  average  of  93,000  between  1903- 
1907;  but  tho  deduction  was  not  made  in  the  years  1860-1869.  In  1907  there 
were  209,000  immigrants  and  90,000  emigrants. 

t  The  cultivated  area  was  estimated  at  849,000  acres  in  1872. 

X  In  1875  an  approximate  estimate  gave  1?>^  millions  of  horned  cattle  and 
.^)7^  millions  of  sheep;  in  1907  the  figures  amounted  to  25,844,000  and 
77,^580,000. 


PREFACE  TO  FIRST  EDITION  xxxiii 

that  cultivated  soil,  the  chief  instrument  of  wealth  in  an 
agricultural  country,  has  an  area  nearly  seven  times  greater 
than  that  of  fourteen  years  ago ;  that  wheat,  the  principal 
vegetable  product  of  that  soil,  now  yields  harvests  thirteen 
times  more  abundant  than  those  of  thirty  years  ago ;  that 
the  products  of  stock-raising  have,  on  the  whole,  greatly 
increased,  despite  the  arrested  development  of  certain  forms 
of  production ;  that  the  railways — the  means  of  transport 
of  man  and  his  produce,  which  did  not  exist  half  a  century 
since — now  cover  the  land  with  a  network  of  increasing 
fineness,  and  are  placing  the  Argentine  in  the  first  rank  of  the 
nations  in  respect  of  the  mileage  of  railroad  per  inhabitant ; 
that  foreign  trade,  which  is  one  of  the  most  characteristic 
forms  of  popular  activity,  and  that  commonly  mentioned 
in  illustrating  a  state's  power  of  expansion,  has  multiplied 
itself  ten  times  since  1865. 

These  figures,  taken  together,  form  a  picture  which  is  not 
only  encouraging,  but  extremely  flattering  to  the  pride  of 
the  Argentine  people. 

But  the  picture  is  not  without  shadows.  The  Indians 
to-day  amount  only  to  thirty  thousand  in  numbers;  the 
Guachos  are  gradually  disappearing  before  the  agricultural 
settler ;  and  the  political  and  moral  unity  of  the  country  is 
not  yet  fully  accomplished.  The  Argentine,  like  most 
of  the  Latin-American  republics,  has  given  itself  a  Consti- 
tution based  upon  that  of  the  United  States ;  but  the  popula- 
tions of  its  Provinces  had  not  the  spiritual  cohesion  exhibited 
by  the  British  Colonies,  and  above  all  by  New  England, 
which  qualities  set  the  seal  on  religious  faith  and  the  love  of 
liberty.  European  immigration  has  brought  us  composite 
elements  which  are  not  yet  amalgamated.  Nearly  all 
immigrants  have  come  to  make  money:  the  majority  are 
indifferent  to  public  affairs,  as  we  see  on  election  days. 
Others  are  only  too  inclined  to  attach  themselves  to  coteries, 
to  cliques.  In  the  relations  between  the  local  governments 
and  the  central  Government,  the  subordination  of  the 
former  is  more  remarkable  than  the  harmony  of  their  mutual 
relations.  The  planters,  intoxicated  by  their  good  fortune, 
are  not  always  so  prudent  as  to  regulate  their  undertakings 
by  their  resources. 


xxxiv    THE  ARGENTINE  IN  THE  20th  CENTURY 

When  in  1890  I  wrote  an  Introduction  to  M.  Latzina's 
book,  the  Argentine  was  in  the  full  swing  of  speculation, 
and  apparently  saw  no  limits  to  its  development.  "The 
Argentines,"  I  said,  "  resemble  an  enterprising  merchant,  who, 
having  opened  shop  in  a  well-frequented  street,  and  having 
borrowed  money  in  order  to  start  with  a  luxurious  establish- 
ment, finds  himself  greatly  embarrassed  for  years,  although 
his  business  prospers,  because  his  advances  and  his  engage- 
ments are  larger  than  his  takings.  It  is  desirable  that  this 
spirit  of  enterprise  should  be  fed,  so  to  speak,  on  diet, 
or  at  least,  according  to  regimen  ;  and  on  such  conditions 
equilibrium  would  be  re-established."  Indeed,  it  then  seemed 
that  a  crisis  must  occur;  and  it  came,  a  few  months  later. 
It  was  very  long  and  very  severe ;  the  Argentine  learned 
what  it  meant  to  lose  its  credit,  and  for  twelve  years  it 
suffered  the  disadvantages  of  a  depreciated  paper  currency. 

The  country  recovered,  and  speculation  rapidly  received 
fresh  impetus.  Thanks  to  the  excess  of  exports,  gold  became 
plentiful ;  it  is  no  longer  at  a  premium  ;  if  interest — which  has 
decreased — still  maintains  itself  at  about  6  per  cent.,  it  is 
because  there  is  a  great  demand  for  capital.  The  budgets 
still  increase  at  a  pace  to  alarm  a  prudent  financier,  in  spite 
of  increased  receipts.  "  If  the  Argentine  does  not  wish  to 
compromise  its  lofty  destinies,"  say  the  authors  of  the 
present  volume,  "  it  is  essential  that  it  should  maintain  an 
economical  administration,  careful  of  the  public  moneys,  yet 
open  to  all  material  progress.  By  so  doing,  it  will  inspire 
confidence  in  men  and  in  capital :  the  two  elements  which  it 
must  still  increase  in  order  to  become  a  sreat  nation. 


To  the  population  born  on  Argentine  soil  were  added, 
between  3  857  and  1908,  3,338,000  immigrants  of  various 
nationality;*  1,706,000  Italians,  670,000  Spaniards,  201,000 
French  and  Belgians,  100,000  Austro-Hungaiians  or  Germans, 

*  On  the  other  hand,  1,322,000  persons  emigrated.  The  census  of  1895  gave 
886,000  foreigners  not  naturalised,  of  whom  493,000  were  Italians,  199,000 
Spaniards,  94,000  French,  etc.  To-day  immigration  consists  especially  of 
Italians  (127,578  in  1906),  Spaniards  (79,287),  Russians  (17,434),  Syrians 
(7677),  Anstrians  (4277),  French  (3698),  etc. 


PREFACE  TO  FIRST  EDITION  xxxv 

and    41,000   English.     Thus   the  Latin  races  are  greatly  in 
he  ascendant :  a  fact  which  facilitates  assimilation. 

The  Government  should  preoccupy  itself  largely  with 
this  matter  of  assimilation  :  for  the  process  is  not  complete. 
There  are  two  effectual  means  which  it  might  employ,  among 
others,  in  order  to  assimilate  its  new  recruits  :  ownership 
of  the  soil  and  education. 

These  two  means  have  produced  marvellous  effects  in 
the  United  States.  The  Homestead  Law  of  the  20th  of 
May  1862  gave  to  every  American  over  twenty-one  years 
of  age,  and  to  every  person  having  declared,  conformably 
with  the  law,  his  intention  of  becoming  a  citizen,  the  right 
to  occupy  gratuitously  160  acres  of  surveyed  lands,  or 
80  acres  only  in  districts  more  advantageously  situated :  if 
the  holder,  after  five  years  of  residence,  has  cultivated  a 
portion  of  his  holding,  the  full  title  is  finally  granted. 
For  such  purpose  the  public  lands  have  been  surveyed  and 
divided  into  lots  by  the  Government.  The  Government  also 
sells  public  lands  by  auction  or  treaty.  Up  to  the  month 
of  July  1905,  it  had  thus  alienated  a  total  of  808,000,000 
acres ;  which  explains  how  millions  of  families — Irish, 
German,  Scandinavian  and  others — have  been  more  or  less 
definitely  settled  on  the  soil  of  that  which  was  already  or 
which  has  since  then  become  their  native  land.  Here  is 
an  example  the  Argentine  Government  would  do  well  to 
follow. 

Education  exercises  an  influence  of  another  kind,  which 
is  no  less  efficacious.  The  Americans  of  the  United  States 
are  well  aware  of  this,  and  this  is  why  they  attach  such 
importance  to  the  upkeep  of  the  "common  schools"  and  the 
attendance  of  the  pupils.  The  children  of  foreign  parents 
become  Americanised  in  class  and  during  play  by  contact 
with  young  Americans.  The  English  tongue  becomes  their 
own  language ;  their  manners  of  thought  and  their  habits 
are  modelled  on  those  of  their  comrades,  whom  they  are 
unconsciously  proud  to  imitate.  If  the  immigrant  family 
does  not  forget  the  memories  of  its  old  home,  at  least  its 
offspring,  from  the  second  generation,  are  rooted  in  the 
American  soil  and  have  American  minds. 

The  Argentine  Government  must  endeavour  to  obtain  a 


xxxvi    THE  ARGENTINE  IN  THE  20th  CENTURY 

like  result.  For  a  long  period  primary  instruction  was  in  an 
extremely  neglected  state  in  the  Argentine  Republic.  How- 
ever, the  Constitution  obliged  the  Provinces  to  secure  such 
instruction,  the  Federal  Government  to  assist  by  finding  a 
third  of  the  expense  of  the  first  installation  of  the  schools. 
But  in  spite  of  the  Constitution,  in  1874  there  were  only  1830 
primary  schools  and  112,000  pupils.  Progress  has  been  accom- 
plished :  in  1905  there  were  5250  schools,  14,118  teachers, 
male  and  female,  and  544,000  pupils.  But  as  the  population 
between  the  ages  of  six  and  fourteen  had  increased  to  827,000, 
only  65  per  cent,  of  the  children  were  attending  school,  and 
only  one  child  in  three  was  able  to  read  and  write.  This  is  a 
state  of  things  that  must  be  changed. 

Secondary  education,  as  far  as  numbers  go,  is  in  no  better 
case ;  there  are  sixteen  "  colleges,"  with  4100  pupils.  The  State 
Universities  of  Buenos  Ayres  and  Cdrdoba  and  the  three 
provincial  Universities  of  La  Plata,  Santa  Fe  and  Parana, 
with  3000  students,  are  relatively  better.* 

The  three  orders  of  instruction  ought  to  work  together  to 
form  a  national  spirit  and  a  moral  unity  ;  but  the  Government 
should  not  forget  that  primary  instruction  is  the  basis,  and 
that  it  is  the  only  kind  of  instruction  that  can  be  bestowed 
upon  each  generation  in  its  entirety,  and  that  the  children  of 
each  generation  should  be  taught  at  an  early  age  not  only 
the  ideas  necessary  to  the  life  of  the  individual,  but  also,  by 
means  of  the  elements  of  national  history,  ethics,  and  applied 
science,  the  knowledge  and  love  of  their  native  country. 

The  Argentine  Republic  as  yet  counts  few  men  to  whom  the 
exigencies  of  life  leave  leisure  to  consecrate  themselves  entirely 
to  letters  or  the  sciences.  It  has  some  distinguished  writers, 
but  they  usually  find  a  recompense  for  their  talent  in  the  public 
press;  for  in  Buenos  Ayres  more  than  200  journals  are 
published.  Men  write  as  hurriedly  as  they  act.  It  is  to  be 
hoped  that  before  long,  with  the  increase  of  wealth,  there 
will  arise  men  of  science,  who  will  find  no  lack  of  material 
in  the  country,  and  men  of  letters,  historians,  novelists, 
sociologists,  etc.,  who  will  also  never  lack  for  matter  in  this 

*  The  writer  does  not  give  the  statistics  of  those  who  go  abroad  to  study ; 
the  nninber  is,  of  course,  very  considerable,  especially  of  those  who  go  to  Paris. 
—[Trans.] 


PREFACE  TO  FIRST  EDITION  xxxvii 

busy,  humming  hive.  Such  men  are  necessary,  because  their 
life-work  goes  far  to  make  up  the  intellectual  capital  of  a 
nation,  and  even  to  form  nationality  itself. 

In  my  introduction  to  M.  Latzina's  book,  I  glanced  at  the 
whole  continent  of  South  America,  and  I  remarked  that 
civilisation  had  scarcely  penetrated  the  interior  of  this  vast 
continent ;  that  the  density  of  its  population  was  extremely 
low  ;  that  the  economic,  intellectual  and  political  life  of  the 
continent  was  concentrated,  if  I  may  so  use  the  word,  upon 
its  periphery  ;  that  is  to  say,  upon  the  shores  which  are  in 
touch,  through  navigation,  with  the  rest  of  the  world ;  that 
the  Argentine  Republic  formed  the  southern  portion  of  this 
belt  connecting  Uruguay  and  Chili ;  that  this  belt  is  wider 
where  the  penetration  of  the  interior  is  easier  and  the  climate 
more  favourable.  This  belt  has  also  been  widened  in 
Southern  Brazil  by  the  construction  of  railroads.  It  is  still 
wider  in  the  Argentine,  because  the  network  of  railways  is 
more  widely  distributed,  the  soil  is  of  even  quality  and 
cultivable,  and  the  climate  temperate  and  favourable  to 
expansion. 

For  the  purposes  of  this  present  Introduction,  let  us 
imagine  a  vaster  area — the  whole  earth,  or,  at  least,  the  three 
inhabited  zones  of  the  earth. 

The  torrid  zone  contains  nearly  a  third  of  the  land  surface 
of  the  earth,  and  only  a  quarter  of  its  population ;  the 
density  of  population  is  thus  below  the  average.  Original 
civilisations  have  existed  in  the  torrid  zone — for  example, 
Mexico  and  Peru  before  the  arrival  of  Europeans — but  these 
existed  on  higher  plateaus  where  the  climate  was  not  tropical. 
There  were  civilisations  in  India  and  the  East  Indies,  but 
these  were  imported  from  the  valley  of  the  Ganges.  There 
are  to-day  intertropical  countries  which  exhibit  an  active 
economic  life :  India,  Mexico,  the  Antilles  and  the  seaboard 
of  Brazil.  Nevertheless,  in  the  greater  part  of  the  torrid  zone 
it  would  seem  that  the  continuous  high  temperature  saps 
human  energy,  and  also  renders  it  to  a  great  extent  un- 
necessary, by  simplifying  life,  reducing  as  it  does  the  number 
of  man's  essential  needs  by  facilitating  the  satisfaction  of 
those  which  are,  like  alimentation,  strictly  necessary. 


xxxviii    THE  ARGENTINE  IN  THE  20th  CENTURY 

The  temperate  zone  of  the  north  is  the  most  favoured  of 
all  these.  It  contains  nearly  half  the  land  surface  of  the 
globe.  It  is  also  the  most  populated,  and  the  average  density 
of  population  is  far  higher,  for  it  contains  about  1,207,000,000 
inhabitants,  or  roughly  speaking,  three-quarters  of  the  popu- 
lation of  the  globe.  Here  it  is  that  we  find  massed  the  four 
great  sources  of  the  ancient  and  modern  civilisation  of  the 
world,  which  also  correspond  to  the  four  great  groups  of 
mankind  ;  China  with  Japan ;  India,  with  the  Deccan  running 
down  to  the  torrid  zone ;  Europe,  and  the  United  States  and 
Eastern  Canada.  In  the  three  first  centres  the  density  of 
population  is  far  greater  than  in  any  other  large  country. 
In  the  fourth,  the  number  of  human  beings  (some  94 
millions)  and  the  density  are  far  less ;  but  this  centre  has 
become'one  of  the  most  important,  by  means  of  its  activity  of 
production. 

There  remains  the  temperate  zone  of  the  south.  In  this 
zone,  the  ocean  occupies  relatively  the  largest  space.  The 
land  emerges  from  it  only  at  the  termination  of  three 
continents — America,  Africa,  and  Australia,  terminated  by 
Tasmania  and  New  Zealand.  Before  the  arrival  of  Europeans, 
each  of  these  divisions  was  absolutely  isolated,  without  any 
relations  with  the  others,  and  inhabited  by  races  entirely 
savage.  The  coming  of  the  Europeans  who  peopled  them, 
and  the  maritime  commerce  which  ensued,  have  awakened 
them  to  civilisation.  In  the  case  of  America,  we  have  seen 
that  free  colonisation  was  not  commenced  until  the  nineteenth 
century.  In  Africa,  at  the  opening  of  the  nineteenth  century, 
there  were  only  a  few  ports  occupied,  and  Australia  was  still 
practically  untouched.  To-day,  in  the  temperate  zone  of 
the  south,  which  comprises  only  a  twelfth  part  of  the  land 
surface  of  the  globe,  there  are  24  millions  of  inhabitants, 
nearly  all  civilised  and  of  European  descent.  This  population 
amounts  to  1'5  per  cent,  of  that  of  the  globe ;  its  density, 
therefore,  is  below  the  average. 

It  is,  however,  the  zone  in  which  the  population  has 
relatively  increased  most  rapidly  since  the  beginning  of  the 
nineteenth  century,  for  at  the  outset  it  certainly  did  not 
count  a  million  inhabitants.  The  Australian  and  African 
divisions   have   owed   their  good  fortune  to   gold,  and  in  a 


PREFACE  TO  FIRST  EDITION  xxxix 

lesser  degree  to  wool ;  but  gold  mines  are  a  source  of  wealth 
which  is  exhausted  by  exploitation.  In  Australia,  where 
he  extent  of  arable  lands  is  limited,  immigration  has  at 
present  practically  ceased.  In  Africa  the  soil  is  little  suited 
to  culture,  and  immigration  to  the  Transvaal  has  been  re- 
cruited rather  among  Asiatic  coolies  than  among  free  workers 
of  European  race. 

In  this  southern  temperate  zone,  the  Argentine  Republic 
is  the  State  which  has  the  most  numerous  population :  that 
in  which  the  population  has  known  the  greatest  increase,  and 
in  which  economic  conditions  promise  the  widest  development 
in  the  near  future.  The  perfecting  of  refrigerating  pro- 
cesses will  certainly  facilitate  the  exportation  of  meats,  and 
it  is  to  be  hoped  that  the  interests  of  trade,  under  the 
necessities  of  the  food  supply  of  the  labouring  classes,  will 
finally  overcome  the  obstacles  which  the  European  producers 
oppose  in  the  way  of  imports.  The  demand  for  wheat,  like 
the  demand  for  meat,  may  vary  according  to  the  year  and  the 
protective  legislation  of  the  nations ;  but  in  general  we  may 
say  that  it  will  increase  rather  than  decrease,  because  the 
population  of  Europe,  and  especially  of  Central  and  Western 
Europe,  is  for  ever  increasing  in  numbers  and  in  density,  so 
that  already  it  cannot  suffice  to  itself  by  producing  its  ali- 
mentary needs  from  its  own  soil,  and  in  proportion  as  it 
becomes  wealthier  it  will  consume  more  white  bread  and  more 
butchers'  meat.  The  United  States  and  Canada  continue  to 
export  wheat;  but  the  rapid  increase  of  the  urban  and 
industrial  population  of  the  United  States  will  assuredly  limit 
this  exportation  to  a  very  great  extent  in  the  twentieth 
century.* 

The  Argentine  Republic,  where  the  harvest  is  due  in 
January,  so  that  its  wheat  arrives  in  the  European  markets 
by  March,  is  the  country  destined  to  profit  the  most  by  these 
advantages.  It  must  learn  how  to  make  use  of  them  wisely, 
practising  a  policy  of  peace  and  concord,  increasing  its  powers 
of  stability  by  the  development  of  the  sentiment  of  nation- 

*  The  consumption  of  -wheat  in  the  United  States  averaged  200  million 
bushels  between  1871  and  1875,  and  531  million  between  1903  and  1907.  The 
exportation  averaged  62  million  bushels  between  1871  and  1875,  and  122 
million  between  1903  and  1907. 


xl        THE  ARGENTINE  IN  THE  20th  CENTURY 

ality,  and  by  inspiring  confidence  both  in  foreign  capitalists 
and  in  immigrants  by  accumulating  capital  of  its  own,  and 
by  learning  to  retain,  in  spite  of  success,  the  foresight  which 
warns  of  perils  and  the  prudence  wliich  avoids  them. 

E.  LEVASSEUR, 

Member  of  the  Institute, 
Administrator  of  the  College  of  France. 


INTRODUCTION 

THIS  book,  intended  to  make  known  in  Europe  the  present 
situation  and  the  economic  future  of  the  Argentine 
Republic,  comes  at  an  opportune  moment  to  fulfil  its  mission 
of  popularisation. 

During  the  last  ten  years  of  the  nineteenth  century  the 
Argentine  has  suffered  all  the  misfortunes  and  known 
all  the  disasters  that  can  affect  a  rural  and  agricultural 
people.  The  locust,  coming  from  the  Tropics,  devoured  the 
crops ;  anthrax,  imported  from  Europe,  decimated  the 
cattle  ;  the  threats  of  a  war  with  Chili  imposed  enormous 
expenses  and  exhausted  the  national  revenue ;  finally,  a 
commercial  and  industrial  crisis,  and  domestic  disturbances, 
consequent  upon  the  general  misfortune,  completed  the  tale 
of  calamities  which  put  the  vitality  of  the  nation  to  the  test. 
But  as  there  is  no  night  so  long  that  it  has  no  dawn,  all 
these  shadows  fled  away.  Our  quarrel  with  Chili  was  sub- 
mitted to  arbitration,  and  the  decision  of  His  Majesty  the 
King  of  Great  Britain  not  only  terminated  a  cause  of  differ- 
ence of  fifteen  years'  duration,  but  re-established  fraternal 
relations  between  the  two  Republics.  The  rural  plagues 
were  attacked  and  vanquished  by  measures  which  experience 
indicated  as  preventive  of  recurrence ;  commercial  and 
industrial  prosperity  returned;  the  tranquillity  of  the 
interior  was  assured ;  and  the  general  welfare  increased.  To 
accentuate  still  further  this  beneficent  reaction,  the  immense 
and  fertile  plains  of  the  pampa,  open  to  the  activities  of  the 
agriculturalists,  began  to  produce  abundant  harvests,  which 
struck  the  European  markets  with  amazement,  and  diverted 
towards  the  Argentine  a  current  of  gold  which  was  estimated 
t  more  than  £20,000,000,  and  a  stream  of  immigration, 
which,  in  the  year  1904,  brought  125,000  workers,  and  which 
promises  to  be  even  greater  in  the  present  year. 

The   Argentine   Republic  has  issued  triumphantly  from 
its  lengthy  and  severe  ordeal ;  it  has  emerged  richer,  stronger 


xlii  THE  ARGENTINE  IN  THE  20th  CENTURY 

and  more  confident  of  its  own  destiny  than  at  any  other 
period  of  its  history ;  and  the  increase  of  its  revenues  and 
the  rapid  growth  of  its  prosperity  have  secured  the  attention 
of  the  great  financial  centres  of  Europe. 

Public  curiosity  being  thus  awakened,  many  people 
have  inquired  :  What  is  the  Argentine  ?  How  far  is  the 
development  of  its  wealth  a  sound  and  durable  process  ? 
What  is  the  probable  future  of  its  people  ?  Is  it  a  meteor 
that  flashes  brilliantly  through  space,  or  a  star  rising  upon 
the  economic  and  political  horizon  ? 

While  some  content  themselves  with  asking  such  ques- 
tions and  awaiting  their  reply,  M.  Lewandowski,  the  repre- 
sentative of  one  of  the  greatest  credit  establishments  in 
France,  wished  to  gain  some  practical  experience  of  the 
phenomenon.  He  took  the  most  certain,  most  practical 
means ;  took  steamer,  crossed  the  ocean,  and  landed  in  the 
Argentine.  With  the  learned  collaboration  of  Seiior  Alberto 
Martinez,  one  of  the  most  competent  of  men  in  matters  of 
statistics  and  finance,  he  made  a  profound  study  of  economic 
questions,  and  the  present  book  is  the  outcome  of  their 
common  observations. 

This  book  should  be  read  by  all  those  who  are  not 
convinced  that  the  word  Europe  sums  up  all  humanity  ;  but 
who  take  the  pains,  on  the  contrary,  to  follow  the  develop- 
ment of  all  other  nations;  understanding  how  necessary  it  is 
for  the  great  nations  to  observe  the  progress  and  evolution 
of  the  younger  peoples.  Thus  they  avoid  the  risk  of  being 
surprised  by  the  sudden  apparition  of  great  economic  or 
political  forces  which  they  had  not  foreseen,  or  by  which  they 
had  not  known  how  to  profit. 

South  America  suffers  from  a  prejudice  that  we  cannot 
unhappily  disclaim  as  being  unjustified.  The  directing 
classes  in  France,  as  in  all  other  European  nations,  with  the 
exception  of  a  small  commercial  and  financial  circle,  seem  to 
have  been  kept  in  intentional  ignorance  of  all  things  relating 
to  the  nations  of  the  new  continent.  The  Argentine,  Chili, 
Brazil,  Venezuela,  Ecuador, — countries  separated  one  from 
another  by  enormous  distances — are  none  the  less,  for  the 
generality  of  Europeans,  more  or  less  one  and  the  same  thing  ; 
that  is,  they  form  a  kind  of  a  geographical  nebulosity,  which 


INTRODUOriON  xliii 

is  kiiown  as  South  America.  The  post-office  employes  of 
Buenos  Ayres  have  often  occasion  to  smile  when  they  read 
the  addresses  inscribed  on  the  envelopes  of  letters  dispatched 
by  the  learned  and  scientific  bodies  of  Europe,  and  Argentines 
residing  abroad  continually  find  food  for  reflection  in  the 
questions  asked  them  by  persons  occupying  the  highest 
positions. 

Yet  for  the  old  world  there  is  every  incentive  to  study 
more  closely  the  development  of  these  new  peoples.  It  is 
enough  to  point  out  that  the  Argentine  to-day  occupies  as 
significant  a  position  as  that  held  by  the  United  States  at  the 
beginning  of  the  nineteenth  century ;  and  that  its  continued 
evolution  will  undoubtedly,  before  the  end  of  the  present 
century,  give  it  an  importance  equal  to  that  of  the  United 
States  at  the  present  time. 

In  a  conversation  with  Mr  Roosevelt  and  his  Secretary  of 
State,  Colonel  John  Hay,  I  had  occasion  to  make  this  very 
remark,  and  the  President  replied,  with  the  rapidity  of 
judgment  and  the  affirmative  tone  which  are  so  characteristic 
of  his  mind :  "  In  less  time  than  that ;  you  will  find  fifty 
years  enough ;  for  you  will  profit  by  all  our  experience  and 
all  the  human  progress  efiected  during  the  nineteenth 
century." 

The  shadow  of  discredit  which  has  hitherto  lain  upon 
South  America  is  explained  by  the  continual  anarchy  to 
which  the  majority  of  its  peoples  have  lent  themselves  since 
the  immense  colonial  empire  of  Spain  threw  off  its  fetters  in 
the  first  quarter  of  the  last  century,  in  order  to  break  up  into 
fifteen  separate  republics.  This  anarchy  and  disorganisation, 
compared  with  the  orderly  spirit  of  progress  which  has 
reigned  in  the  great  republic  of  the  North,  have  given  rise  to 
the  belief,  to-day  general,  that  the  so  different  destiny  of 
these  States  was  due  to  the  special  qualities  and  aptitudes  of 
the  Anglo-Saxon  race,  which  the  Latin  races  lacked. 

This  belief  results  from  a  superficial  and  incomplete 
examination  of  the  facts,  and  has  gained  easy  acceptance, 
even  in  works  of  a  more  or  less  scientific  nature,  such  as 
The  Psychological  Latvs  of  the  Evolution  of  Peoples,  in 
which  the  author  cites,  with  regard  to  the  Latin  races  and 
the  peoples  of  South  America,  a  number  of  inaccurate  and 


xliv     THE  ARGENTINE  IN  THE  20th  CENTURY 

prejudiced  facts,  which  have  been  gathered  from  the  writings 
of  a  dyspeptic  and  ill-tempered  journalist.  Such  data  have 
caused  M.  Gustave  Lebon  to  deduce  psychological  laws  which 
are  hardly  favourable  to  the  South  American  races. 

If  we  wish  to  gain  some  idea  of  the  true  causes  of  this 
diversity  of  destiny  between  the  peoples  of  North  and 
South  America,  we  must  study  the  origin  of  each  and  the 
particular  form  which  colonisation  has  assumed  in  each 
case ;  forms  imposed  by  the  force  of  historic  facts  rather 
than  by  the  will  of  man. 

The  Anglo-Saxons  arrived  in  the  American  coasts  and 
founded,  in  the  first  half  of  the  seventeenth  century,  such 
cities  as  Boston,  Charleston,  Philadelphia,  etc.,  when  America 
had  already  been  discovered  and  explored  by  the  Spaniards 
a  century  and  a  half  before.  These  colonies  were  formed  of 
groups  of  families  who  had  abandoned  their  mother-country 
to  seek  a  new  one,  where  they  could  live  and  labour  free 
from  the  persecutions  of  religious  and  political  intolerance. 

When  these  colonies  attained  a  certain  fame,  the  surplus 
of  the  overflowing  populations  of  Europe  was  naturally 
attracted  by  these  virgin  and  fertile  lands,  relatively  near  at 
hand  though  across  the  ocean.  Thus  there  formed  a  current 
of  immigration  which  rapidly  peopled  America  and  utilised 
the  great  natural  resources  of  its  enormous  territory.  In 
this  way  was  gradually  formed  a  new  people,  which  was  to 
a  certain  extent  a  development  of  the  various  nations  from 
which  it  originated,  and  which  preserved  their  customs  and 
their  political  and  social  habits. 

These  colonists  began  by  buying  land  of  the  native  tribes  ; 
but,  increasing  in  numbers  and  in  strength,  they  found  it 
more  convenient  to  rob  them,  thus  forcing  the  Red  Indians 
to  retreat  towards  the  north  and  west ;  and  for  reasons  of 
self-respect,  or  on  account  of  religious  principles,  no  deliberate 
attempt  was  made  to  mingle  with  the  indigenous  population. 

This  form  of  colonisation,  whose  prime  cause  was  to  be 
found  in  persecution,  not  in  the  execution  of  a  preconceived 
plan,  resulted  in  the  existence,  at  the  end  of  the  eighteenth 
century,  of  thirteen  colonies  peopled  exclusively  by  men  of 
the  white  races,  originally  natives  of  the  countries  of 
Northern  Europe,  who  had  transported  to  this  new  soil  their 


INTRODUCTION  xlv 

manners  and  customs,  their  social  and  political  laws,  their 
liberal  traditions  and  their  economic  system,  so  that  from 
the  moment  they  declared  themselves  independent,  they 
were  able  immediately  to  form  a  single  nation,  united  by  all 
the  ties  which  make  for  the  cohesion  of  a  people,* 

To  attain  such  progress,  to  reach  the  summit  on  which 
they  rest  to-day,  the  United  States  had  only  to  persist  in  the 
same  path,  to  follow  the  same  groove,  and  the  incontestable 
merit  of  this  people  and  of  its  great  statesmen  is  that  they 
have  been  faithful  to  the  principles  of  liberty  and  equality 
which  they  inherited  from  their  ancestors,  the  venerable 
"  conscript  fathers " ;  principles  which  they  ratified  in  the 
admirable  Constitution  whence  this  vast  political  organism 
has  derived  its  cohesion,  its  vitality,  and  its  strength. 

How  different  were  the  origins  of  the  peoples  of  Latin 
America !  The  Spanish  sailors  did  not  cross  the  ocean  like 
the  passengers  of  the  Mayflower,  or  the  companions  of  Penn, 
seeking  solitary  shores,  known  though  distant,  where  they 
might  establish  a  home,  there  to  live  and  labour  in  peace  and 
liberty. 

The  Spanish  navigators,  as  brave  as  they  were  audacious, 
launched  themselves  into  the  unknown,  guided  only  by  their 
own  genius,  in  order  to  discover  a  world,  to  conquer  new  lands, 
new  subjects,  for  their  country  and  their  king  ;  and  in  the 
pursuit  of  that  heroic  dream  they  performed  exploits  which 
to  this  day  amaze  us  by  their  audacity. 

These  were  the  famous  conquistador es,  whom  one  of  their 
descendants,  Jose  Maria  H^redia,  has  celebrated  in  the 
admirable  lines : — 

"  As  from  the  natal  charnel-heap  a  flight 

Of  falcons :  sick  of  purseless  pride  at  home 
By  Murcian  Palos  pilots  and  captains  come 
With  brutal  and  heroic  dreams  alight  : 
*  The  late  Signor  Pellegrini,  in  his  anxiety  to  defend  the  Latin  races,  is  not 
strictly   impartial.      At   the   time    of    the   Declaration   of    Independence    the 
population  of  the  States  was  very  largely  English  (with  a  substratum  of  Dutcli 
in  New  York)  but  of  different  periods  ;  and  these   different  periods  preserved 
their  own  traditions.     The  difference  between  the   New   England  Quaker  and 
the  Kentucky  trapper,  or   the   Virginian  fox-hunting   squire,  and  the  Dutch 
patroon   or   Highland   crofter,   was    as   great   as  any  to  be   found  among  the 
Latin  races,  if  not  greater,  and  was  largely  a  difference  of  arrested  periods  as 
well  as  a  racial  and  a  social  difference.     The  result  was  that  Federalism  was 
accomplished  peacefully  only  by  the  genius  of  Hamilton. — [Tr.'^ns.] 
D 


xlvi  THE  ARGENTINE  IN  THE  20th  CENTURY 

They  seek  the  fabulous  ore  that  comes  to  birth 

And  ripens  in  Cipango's  distant  mines. 

And  the  trade-wind  their  long  lateens  inclines 
Toward  the  dim  limits  of  the  Western  earth." 

These  first  colonisers  of  Spanish  America  —  soldiers, 
missionaries,  officials,  adventurers,  men  without  family — 
seized  upon  a  whole  continent,  which  they  discovered  and 
conquered  at  the  price  of  unheard-of  exertions.  They 
parcelled  out  the  land,  subjugated  the  native  tribes,  reducing 
them  to  servitude  in  their  famous  encomiendas,  or  putting 
into  experimental  practice,  as  in  the  Jesuit  missions,  theories 
of  collectivism,  which  is  to-day  regarded  as  a  modern 
invention.  It  was  a  true  feudal  system  that  arose  in  the 
new  world.* 

If,  on  the  one  hand,  the  native  races  were  initiated  into 
the  doctrines  of  Catholicism  in  exchange  for  their  liberty  and 
independence,  they  did  not,  on  the  other  hand,  receive  from 
their  masters  any  political  instruction,  but  preserved  their 
habits  of  submission  and  passive  obedience  to  their  chief, 
which  constituted  their  sole  political  tradition. 

When,  therefore,  the  day  of  emancipation  arrived,  and 
this  enormous  colony,  in  arms  against  its  oppressors,  declared 
itself  independent,  and  divided  itself  into  several  Republics, 
the  great  mass  of  the  population  consisted  of  Indians  con- 
verted to  Christianity,  and  half-breeds,  who  preserved  their 
habits  unchanged  and  had  no  ideas,  no  traditions,  other  than 
that  of  government  by  individual  might. 

Only  in  the  urban  centres  did  the  white  race,  with  its 
conception  of  political  institutions,  predominate.  And  when 
the  new  Government  wished  to  organise  itself  in  an  in- 
dependent manner,  the  two  tendencies  and  traditions,  which 
correspond  to  two  distinct  mentalities,  violently  clashed, 
and  began  that  long  struggle,  not  wholly  terminated  even 
to-day,  of  which  the  history  is  the  history  of  anarchism  in 
America. 

Another  factor  that  also  procured  this  conflict  was  the 
colonial   political   economy  of  Spain,   which   was   not   only 

*  It  must  be  remembered,  in  comparing  North  with  South  America, 
that  the  former  also  had  its  period  of  extensive  slavery,  its  plantations  worked 
by  convict  labour,  and  for  a  period  an  almost  feudal  system. — [Trans.] 


INTRODUCTION  xlvii 

a  mistake,  but  a  mistake  of  the  period ;  an  error  which 
closed  the  whole  continent  to  commerce,  shut  it  away  from 
the  outer  world,  and  maintained  these  masses  of  humanity 
in  ignorance  and  isolation,  in  order  to  exploit  them  simply 
as  a  machine,  or  as  an  element  of  wealth  for  the  service  of 
their  masters. 

The  problem  which  confronted  the  politicians  of  South 
America  when  they  found  themselves  face  to  face  with  this 
new  people,  whom  they  must  of  necessity  organise,  was 
thus  very  different  from,  and  far  more  difficult  than  the 
problem  which  the  founders  of  the  North  American  Union 
had  to  resolve. 

These  native  masses  obeyed  with  all  their  might  and 
with  the  utmost  enthusiasm  so  long  as  it  was  a  question 
of  fighting  against  the  foreign  troops  and  of  winning  their 
independence ;  but,  victory  once  assured,  guided  by  their 
leaders,  the  caudillos,  most  of  whom  were  white,  they 
revolted  against  the  tendencies  which  began  to  show  them- 
selves among  the  Europeans  of  the  cities,  and  in  many  places 
succeeded  in  dominating  over  them  by  force  of  numbers, 
thus  preventing  all  political  and  administrative  progress, 
and  maintaining,  as  their  form  of  government,  the  personal, 
arbitrary,  and  irresponsible  power  of  a  leader,  that  is,  of 
the  caudillo. 

The  written  Constitutions  which  these  people  had 
established  upon  declaring  their  independence,  and  which 
were  inspired  by  the  Constitutions  of  the  United  States  or 
the  Swiss  Republic,  were  thus  reduced  to  a  dead  letter,  as 
they  were  in  complete  contradiction  to  the  political  habits  of 
the  mass  of  the  populace,  and  required,  for  their  application, 
a  political  education  which  the  peoples  of  South  America  did 
not  possess.  A  whole  century  had  to  elapse  before  immigration, 
material  interest,  and  the  influence  of  civilisation,  were  able 
slowly  to  modify  the  political  mentality  of  these  peoples,  by 
reinforcing  and  popularising  the  principles  of  government, 
extirpating  the  elements  and  suppressing  the  causes  of  the 
anarchy  which  had  so  long  disturbed  them. 

Among  the  nations  which  experienced  these  beneficent 
influences,  the  Spanish  colony  known  as  the  Viceroyalty  of 
the   Rio  de   la  Plata,   to-day  the   Argentine  Republic,   was 


xlviii    THE  ARGENTINE  IN  THE  20th  CENTURY 

quite  specially  favoured.  Its  territory,  composed  of  immense 
prairies,  the  celebrated  Argentine  "  pampas,"  stretching  from 
the  sea-coast  and  the  river  littoral,  offered  the  unique  wealth 
of  their  fertility  and  their  climate.  There  were  no  mines 
of  gold  or  silver  to  arouse  the  greed  of  adventurers ;  they 
came  to  these  regions  only  to  traverse  them,  and  so  to  proceed 
immediately  to  the  gold-bearing  regions  of  the  distant 
Cordilleras, 

Moreover,  the  first  colonists  who  established  themselves 
on  the  banks  of  the  Plata,  repulsed  and  expelled  by  the 
natives,  were  forced  to  abandon  a  certain  number  of  cattle 
and  horses,  which  found  in  these  prairies  an  admirable 
opportunity  to  live  and  multiply  in  freedom,  until  finally 
they  formed  the  immense  herds  of  wild  cattle  and  horses, 
whose  hides  became  the  principal  wealth  and  the  chief  article 
of  commerce  of  these  regions. 

Although  the  Rio  de  la  Plata  had  no  commercial  relations 
with  the  outside  world,  and  was  only  able  to  trade  with 
Cadiz,  the  immensity  and  the  solitude  of  its  shores  favoured 
a  contraband  trade  ;  to  such  a  degree  that  English,  Dutch, 
and  Portuguese  smugglers  came  from  all  parts  to  exchange 
their  manufactured  articles  for  the  hides  of  these  wild  herds. — 
This  it  is  that  explains  how  Buenos  Ayres  was  able  from  the 
outset  to  become  a  great  commercial  centre,  in  which  the 
trades  dependent  upon  stock-raising  quickly  occupied  the 
first  place. 

Commercial  activity,  the  development  of  communication 
by  sea,  the  fertility  of  the  soil,  the  climate — all  contributed 
from  the  early  days  of  emancipation  to  attract  European 
immigration.  This  immigration,  like  that  which  peopled  the 
America  of  the  north,  was  composed  of  families  who  came  to 
settle,  to  form  new  homes,  to  labour.  These  families,  follow- 
ing the  example  of  their  predecessors  in  the  United  States 
and  for  the  same  causes,  did  not  mingle  with  the  native 
tribes,  but  struggled  against  them,  and  forced  them  to 
abandon  their  lands  and  fly  to  the  south,  until  at  last,  after 
a  long  and  cruel  struggle,  they  almost  completely  disappeared. 

This  immigration  increased  year  by  year,  and  to-day  the 
great  majority  of  the  population  of  the  Argentine  Republic — 
a  population  now  exceeding  5  millions — is  of  European  origin. 


INTRODUCTION  xlix 

That  this  immigration,  which  flows  from  all  the  nations 
of  Europe,  has  been  the  chief  agent  of  the  present  prosperity 
of  the  Argentine,  and  is  the  condition  of  its  future  greatness, 
is  an  incontestable  fact.  One  of  our  leading  statesmen  has 
declared,  of  America,  that  "  to  govern  is  to  people  "  ;  and  this 
aphorism  has  remained  a  fundamental  principle  of  government. 
To  recognise  the  full  force  of  this  assertion,  we  must  reflect 
that  these  unusually  fertile  prairies,  situated  in  a  privileged 
climate,  near  the  sea-coast  or  on  the  banks  of  enormous  rivers, 
navigable  even  by  transatlantic  steamers,  need  nothing  but 
human  labour  to  transform  them,  with  less  eff'ort  and  at  less 
expense  than  anywhere  else  in  the  world,  into  immense  fields 
of  wheat  or  maize,  or  pastures  of  lucerne,  covered  with  herds, 
able  to  produce  bread  and  meat  enough  to  feed  all  Europe. 

Accordingly  the  agricultural  production  of  the  Argentine 
Republic  is  limited  only  by  the  number  of  hands  which  lend 
themselves  to  its  exploitation ;  in  which  we  have  a  repetition 
of  the  very  phenomenon  which  has  served  as  the  foundation 
of  the  development  of  the  United  States. 

Under  these  conditions  the  progress  of  the  Argentine 
Republic  is  a  necessary  and  inevitable  fact,  which  extra- 
ordinary circumstances  might  for  a  time  retard,  but  which 
nothing  could  finally  arrest ;  except,  indeed,  one  could  restrain 
the  daily  exodus  of  fresh  swarms  from  the  human  hive, 
which  abandon  the  old  soils,  exhausted  by  production,  to 
seek  out  the  fertile,  virgin,  and  unpeopled  areas  of  the  globe. 

Hitherto  this  exodus  has  been  directed  principally  to 
the  United  States  ;  attracted  thither  by  a  host  of  special 
and  favouring  circumstances.  But  the  time  is  rapidly 
approaching  when  North  America  in  turn  will  find  herself 
populated  to  the  saturation  point,  and  will  no  longer  be  able 
to  receive  the  hosts  which  benefited  her  formerly.  The 
laws  of  the  United  States  are  already  beginning  to  impose 
conditions  upon  immigration  which  are  constantly  becoming 
more  severe  ;  and  these  laws  are  imposed  by  the  two  great 
political  forces — the  superior  social  classes  and  the  lower 
classes  of  the  people. 

The  upper  classes,  Anglo-Saxon  in  origin,  fear  that  con- 
temporary immigration,  coming  as  it  does  from  peoples  of 
alien  race,  from  the  south  or  east  of  Europe,  may  modify  or 


1  THE  ARGENTINE  IN  THE  20th  CENTURY 

enfeeble  those  great  moral  and  political  qualities  to  which 
they  attribute  the  greatness  and  prosperity  of  their  nation. 
On  the  other  haud,  the  federated  workers  see  in  these  new 
arrivals,  healthy  and  vigorous,  but  having  fewer  needs,  a 
source  of  dangerous  competition,  which  may  have  a  disastrous 
influence  on  conditions  of  labour  and  payment. 

The  stream  of  irrigation  which  is  now  setting  in  towards 
the  United  States,  and  which  amounted  in  numbers  to 
800,000  in  the  year  1904,  must  necessarily  therefore,  as  time 
goes  on,  turn  aside  in  other  directions,  and  as  it  will  nowhere 
meet  with  more  advantageous  circumstances  than  in  the 
Argentine,  it  will  flow  thither  as  it  flows  already,  but  in 
greater  and  greater  numbers,  resulting  in  a  development  of 
wealth  and  power  superior  to  any  hitherto  known. 

Some  persons,  however,  formulate  certain  reservations 
as  to  the  consistency  and  the  political  and  social  value  of 
nations  formed  by  these  human  inundations,  composed  as 
they  are  of  men  of  different  races,  having  neither  the  same 
language,  nor  the  same  religion,  nor  the  same  customs  ;  they 
doubt  whether  this  new  Babel  can  give  birth  to  a  national 
spirit  sufficiently  vigorous  to  impress  a  character  of  political 
and  moral  unity  upon  these  new  recruits. 

In  order  to  prove  that  these  fears  are  ill-founded,  we  have 
only  to  take  the  practical  example  furnished  by  the  United 
States.  Into  this  vast  national  crucible  there  poured,  from 
the  outset,  the  stream  of  emigration  from  Great  Britain, 
Holland,  France,  and  Spain;  later  came  Scandinavians, 
Germans,  Lithuanians,  Poles,  Hungarians,  Italians,  Syrians 
and  Arabs.  From  the  fusion  of  all  these  elements  has 
issued  a  new  race,  homogeneous  and  powerful,  with  a  strong 
national  spirit  which  is  known  as  "  the  American  spirit,"  and 
under  that  name  has  won  the  respect  of  the  world.  This 
result  is  neither  accidental  nor  due  to  special  antecedents ; 
it  is  the  consequence  of  a  natural  evolution,  ably  and 
intelligently  directed. 

The  European  law,  which  attributes  to  the  son  the  nation- 
ality of  his  father,  may  have  had  its  justification  in  the  past ; 
to-day  it  is  maintained  only  by  force  of  tradition. 

Nationality  and  love  of  country  are  only  an  extension  of 
the  love  of  the  family  and  the  home ;   and  these  sentiments 


INTRODUCTION  li 

cannot,  any  more  than  others,  be  forced  upon  one  by  law.  There 
can  exist  for  a  man  only  the  home  and  the  family  in  which 
he  was  born  and  bred.  Doubtless  he  will  feel  himself 
attached  to  the  home  of  his  forbears  by  ties  of  sentiment  and 
respect ;  but  all  the  roots  of  his  intimate  feelings  bind  him 
to  the  home  and  the  family  into  which  he  was  born ;  they 
are  in  his  blood,  and  thence  he  has  received  the  first  impres- 
sions which  mould  his  character  and  imprint  those  character- 
istics which  form  his  personality. 

It  is  the  same  with  nationality  and  the  mother-country. 
It  is  useless  to  attempt  to  persuade  either  child  or  man  that 
his  country  is  not  that  in  which  he  was  born,  in  which  he  has 
grown  up,  but  another  distant  country  which  he  has  neither 
known  nor  seen. 

The  difference  of  origin  among  the  children  of  immigrants 
of  different  nationalities  disappears  in  childhood,  through 
the  community  of  life  in  school  and  workshop;  through 
sharing  alike  in  work  and  play ;  and  it  is  in  the  earlier  years 
of  life  that  the  mind  is  moulded  by  its  surroundings  ;  in  these 
years  develops  that  feeling  of  attachment  to  the  soil,  of 
union,  solidarity,  and  common  memories,  that  shows  itself 
later  in  an  ardent  patriotism.  Unity  of  language  necessarily 
favours  the  process  of  fusion,  and  explains  the  fact  that  the 
descendants  of  immigrants  of  different  race,  religion,  language, 
habits  and  traditions,  are  able  to  fuse  so  completely  as  to  form 
a  perfectly  homogeneous  population,  one  in  mind  and  in 
sentiment,  thus  constituting  a  new  nationality,  young,  vigor- 
ous and  strongly  individual. 

We  have  thus  under  our  eyes  a  practical  example  of  the 
unity  of  the  human  race.  The  hazards  of  life,  in  the  course  of 
centuries,  having  dispersed  the  primitive  race  throughout  the 
earth,  it  has  formed,  under  the  influence  of  circumstances, 
new  types,  which  in  the  course  of  time  have  met  and 
mingled,  to  form  new  crosses  in  their  turn,  which  as  a  matter 
of  fact  are  only  the  modalities  of  a  common  primitive  race. 

The  same  phenomenon  is  being  repeated  in  the 
Argentine,  as  in  all  the  American  republics,  and  the  spontane- 
ous and  vital  sentiment  of  nationality  continually  strikes 
the  observer,  who  notes  the  pride  with  which  a  child  born  in 
Argentina,  whether  he  be  the  son  of  a  Spaniard,  Frenchman, 


lii        THE  ARGENTINE  IN  THE  20th  CENTURY 

Italian,  or  German,  affirms,  when  questioned,  that  his 
country  is  the  Argentine. 

Thus  this  Republic  possesses  all  the  requisite  conditions 
of  becoming,  with  the  passage  of  time,  one  of  the  greatest 
nations  of  the  earth.  Its  territory  is  immense  and  fertile, 
its  surface  being  equal  to  that  of  all  Europe,  excepting  Russia ; 
it  is  capable  of  supporting  with  care  at  least  100  millions  of 
human  beings ;  almost  every  climate  is  to  be  found  within  its 
limits,  and,  consequently,  it  can  yield  all  products,  from  those 
of  the  tropics  to  those  of  the  polar  regions.  Its  rivers  and 
its  mountains  are  among  the  greatest  of  the  globe.  As  its 
maritime  frontier  it  has  the  Atlantic,  which  brings  it  into 
contact  with  the  whole  world. 

It  is  governed  by  institutions  more  liberal  than  those  of 
any  other  nation,  especially  in  all  that  affects  the  foreigner ; 
it  regards  the  influx  of  immigration  with  approval,  and  seeks 
to  promote  it.  In  proportion  as  its  vast  vacant  spaces  become 
peopled  their  value  is  increased  tenfold,  and  production  grows 
at  an  enormous  pace;  for  a  single  family,  by  the  aid  of 
modern  machinery,  can  exploit  a  larger  area  of  soil,  yielding 
a  produce  far  greater  than  is  required  for  its  own  consump- 
tion ;  a  fact  which  explains  the  surprising  rate  at  which 
the  export  trade  has  increased. 

Such  are  the  true  causes  of  the  prosperity  of  this  country, 
as  is  proved,  with  abundant  detail,  by  MM.  Martinez  and 
Lewandowski ;  and  as  these  causes  are  not  accidental,  but 
fundamental  and  permanent,  they  should  produce  in  South 
America  the  same  results  as  in  the  North. 

Granted  that  wealth  and  prosperity  are  essentially  con- 
servative elements,  we  have  here  a  serious  guarantee  of 
political  stability ;  the  more  so  as  the  country  has  already 
passed  the  difficult  age  and  is  cured  of  the  malady  endemic 
to  South  America — anarchy. 

It  is  also  to  be  hoped  that  our  Argentine  politicians, 
taught  by  experience,  and  comprehending  all  the  responsi- 
bilities imposed  upon  them  by  their  noble  mission — the  work  of 
racial  regeneration  and  the  betterment  of  South  America — will 
succeed  in  making  constitutional  government  an  actual  fact, 
by  restraining  and  uprooting  the  tendency  to  personal  power, 
which  is  the  lamentable  heritage  of    indigenous  tradition. 


INTRODUCTION  liii 

It  is  a  great  nation  that  is  rising  on  the  brink  of  the 
twentieth  century ;  the  mistress  of  an  enormous  inheritance. 
Immigration  and  the  increase  of  the  birth-rate  are  furnishing 
it  with  the  arms  it  requires  ;  it  lacks  only  those  reserves  of 
capital  which,  like  all  new  peoples,  it  has  not  as  yet  had  time 
to  create. 

In  no  country  can  European  capital  find  a  more  fertile  or 
advantageous  field  for  its  operations:  a  fact  already  well  known 
in  England ;  and  one  the  authors  of  this  book  have  wished  to 
emphasise  for  the  greater  benefit  of  French  capital.  In  this 
they  serve  the  interests  of  France  and,  still  more  particularly, 
those  of  the  Argentine  Republic ;  and  in  the  name  of  my 
own  compatriots,  as  well  as  for  myself,  I  take  this  oppor- 
tunity of  expressing  my  sincere  gratitude. 

C.  PELLEGRINI. 


THE   ARGENTINE   IN    THE 
20TH  CENTURY 

GENERAL  PLAN  AND  METHOD  OF  THIS  BOOK. 

BEFORE  commencing  a  study  of  the  financial  and  economic 
situation  in  the  Argentine  Republic,  it  is  important  to 
decide  at  the  outset  as  to  the  spirit  in  which  this  examina- 
tion should  be  pursued,  and  the  method  most  proper  to  such 
an  inquiry.  We  tread  upon  a  novel  and  peculiar  field,  and 
any  too  rigid  comparison  with  the  events  of  other  countries 
might  easily  lead  us  to  errors  of  appreciation. 

Above  all  we  must  practise  the  philosophical  principle 
nil  admirari ;  we  must  be  astonished  at  nothing,  and 
abstain  from  all  too  absolute  judgments.  Although,  as  the 
figures  of  foreign  trade  will  show,  the  progress  of  the 
country  has  surpassed  all  expectation,  it  is,  on  the  other 
hand,  almost  impossible  to  foretell  how  far  the  results  of  one 
year  will  be  ratified  by  the  year  following. 

Like  all  young  nations,  the  Argentine  progresses  on  its 
path  to  the  unknown  by  leaps  and  bounds ;  it  is  as  yet  in  an 
unstable  condition,  in  which  the  oscillations  of  prosperity  are 
still  of  great  amplitude  and  exceedingly  sudden. 

It  is  easy  to  discern  the  cause  of  this  essentially  unstable 
condition. 

The  Argentine,  in  its  present  phase,  is  an  agricultural 
country,  whose  principal  sources  of  wealth  are  cereals  and 
stock-raising ;  the  result  is  that  each  year  the  whole  life  of 
the  country  is  affected  by  the  harvest.*  On  the  harvest 
depends,  in  a  great  degree,  the  movements  of  external 
commerce  ;   it  produces  those  sudden  changes  which  occur 

*  We  U80  the  word  harvest  here  in  its  widest  sense,  but  we  must  ultimately 
distinguish  the  results  of  stock-raising  from  those  of  agriculture,  since  they  do 
not  necessarily  vary  in  the  same  direction. 

55 


50      THE  ARGENTINE  IN  THE  20th  CENTURY 

from  year  to  year,  and  which  result  occasionally  in  a 
variation  of  £8,000,000  to  £12,000,000  above  or  below  the 
Average. 

The  harvest  influences  not  only  the  exports,  more  than 
half  of  which  consist  of  agricultural  products,  but  has  no 
less  an  influence  on  the  value  of  importations.* 

The  national  powers  of  consumption  are,  in  fact,  very 
intimately  connected  with  the  measure  of  the  agricultural 
output ;  as  the  latter  is  bad  or  good,  the  home  consumption 
absorbs  more  or  fewer  imported  products.  Thus  the  poor 
harvests  of  1901  and  1902,  which  resulted  in  a  fall  of  nearly 
£1,800,000  in  the  cereal  exports,  produced  in  1902  a  fall 
of  £800,000  in  the  imports  of  iron  and  materials  used 
for  construction.  The  same  depression  was  visible  in  the 
imports  of  textiles  and  beverages,  and  still  more  so  in  those 
of  articles  de  luxe.  The  spending  powers  of  the  country 
being  closely  dependent  on  the  facility  of  realising  the 
products  of  the  soil,  it  is  easy  to  understand  that  in  the  case 
of  a  bad  harvest  or  a  poor  market  the  consumers  have  no 
longer  the  same  powers  of  purchase. 

We  find  the  same  ups  and  downs  in  the  figures  of  the 
Budget,  the  contributive  powers  of  the  country  being 
influenced  by  the  same  causes  as  its  consumption.  If  the 
crops  are  poor,  the  Budget  of  the  following  year  shows 
immediate  traces  of  the  fact.  Thus  in  1902,  the  year  of  the 
bad  harvest,  the  total  receipts  were  estimated  at  £5,534,000  in 
paper,  and  £9,486,669  in  gold;  but  the  actual  receipts  were 
only  £5,221,000  in  paper,  and  £8,047,755  in  gold  ;  a  deficit 
of  £1,438,913  in  gold. 

At  the  same  time  the  Customs  receipts,  which  are  the 
most  variable  item  of  the  revenue,  on  account  of  their  direct 
relation  to  consumption,  have  fallen  from  one  year  to  another 
(as  in  1903  compared  with  1902),  as  much  as  £1,200,000  in 
consequence  of  the  agricultural  crisis. 

There  is  an  equally  direct  relation  between  the  financial 
situation  and  the  results  of  the  harvest.  If  the  commercial 
balance  is  favourable,  the  Argentine  becomes  a  creditor  of 
foreign  countries  by  the  excess  of  its  exportations,  and  the 

*  The  value  of  the  exports  in  1!»07  was  £59,240,874,  and  according  to  the 
officii']  figures  the  products  cf  agriculture  .amounted  to  £32,818,324 


GENERAL  PLAN  67 

resulting  payments  in  gold,  after  the  deductions  of  the  in- 
terest on  the  foreign  debt,  increase  the  proportion  between 
the  metallic  currency  and  the  monetary  circulation  in  general. 

As  these  few  examples  prove,  the  prosperity  of  the 
country  is  subordinated  to  the  result  of  the  harvest;  the 
latter  gives  the  measure  of  all  improvement,  all  progress  of 
a  financial  and  economic  order.  Unlike  the  ancient  European 
nations,  the  Argentine  Republic  has  no  reserves  of  accumu- 
lated capital  behind  it,  so  that  it  can  live  on  its  own 
savings  in  times  of  crisis.  Its  commerce  and  its  industries 
depend  almost  exclusively  upon  its  agricultural  yield,  and 
share  all  the  latter's  vicissitudes. 

All  depends  on  the  value  of  the  soil,  the  basis  of  public 
and  private  wealth.  The  power  of  expenditure  which 
follows  a  good  harvest  may  contribute  towards  proving 
personal  property,  but  the  latter  remains  always  strictly 
related  to  the  agricultural  yield  and  general  produce  of  the 
soil,  and  does  not  constitute  an  easily-realised  reserve. 

For  the  rest,  we  must  recognise  that,  as  a  rule,  this  capital 
does  not  remain  inactive,  and  is  as  little  as  possible  sterilised 
by  investment  in  the  public  funds.  Those  who  possess 
available  cash,  in  the  shape  of  revenue  from  a  large  estate, 
usually  employ  it  by  increasing  their  stock  of  cattle,  or  in 
reclaiming  more  land,  or  by  investing  it  in  other  estates ; 
so  that  all  that  comes  from  the  earth  returns  to  the  earth, 
and  goes  to  increase  its  yield. 

The  peculiar  situation  of  this  great  agricultural  country, 
which  constitutes  at  once  the  strength  and  the  instability 
of  the  Republic,  shows  us  in  what  spirit  and  by  what  method 
it  should  be  studied.  All  depends  upon  the  yield  of  the 
soil,  for  this  is  the  great  dispenser  of  the  national  wealth ; 
^t  is  therefore  the  agricultural  system  that  we  must  examine 
first  of  all,  if  we  wish  to  arrive  at  a  solution  of  the  problems 
arising  from  the  present  condition  of  the  Argentine  or  predict 
its  future. 

To  follow  out  this  general  plan,  we  must  consider  the 
country  first  of  all  from  two  standpoints :  we  must  examine 
into  its  production  and  its  markets  or  outlets,  in  order  to 
learn  the  true  conditions  of  its  existence,  the  value  of  its 
soil,  and  its  sources  of  revenue. 


58        THE  ARGENTINE  IN  THE  20th  CENTURY 

We  shall  then  proceed  to  examine  its  administrative 
machinery,  showing  how  the  Argentine  lives  and  progresses 
as  a  nation,  and  to  analyse  its  financial  and  monetary 
organisation  with  reference  to  the  economic  situation. 

The  two  portions  of  this  scheme  are  closely  connected, 
and  their  study  must  lead  us  to  the  same  conclusion,  that 
the  Argentine  is  a  nation  in  a  state  of  growth,  and,  like  all 
young  nations,  still  uncertain  of  its  first  steps ;  but  it  is 
animated  by  a  spirit  of  initiative,  and  urged  by  the  breath 
of  progress,  which  may  lead  it  to  a  high  destiny  among 
the  great  productive  countries  of  the  earth. 


THE  ARGENTINE  NATIONALITY* 

Is  thero  an  Argentine  nationality,  and  ■what  is  its  significance  in  respect  of  the 
territory  it  occupies  ? — The  formation  of  this  nationality. 

An  examination  of  the  qualities  of  the  Argentine  people. — Sense  of  progress  ; 
remarkable  faculty  of  assimilation :  character  essentially  practical. — The 
fusion  of  the  Latin  genius  with  Anglo-Saxon  energy. 

The  contrast  between  the  political  world,  with  its  instability  and  lack  of  organ- 
isation, and  the  economic  world,  which  manifests  intense  vitality  and 
national  progress. — The  necessity  of  developing  the  national  idea,  and 
of  raising  it  above  material  questions. — The  slow  elaboration  of  a  new 
race  born  of  the  various  elements  of  immigration. 

TO  present  a  complete  picture  of  the  Argentine,  it  is  not 
enough  to  describe  its  configuration,  its  great  rivers,  its 
climate,  its  population,  its  forms  of  agriculture,  and  the  value 
of  its  soil ;  all  this  is  a  dead  letter,  and  will  by  no  means 
yield  us  the  secret  of  the  country's  future,  unless  we  first 
resolve  one  question  of  a  sociological  character :  Is  there  an 
Argentine  nationality,  and  what  does  it  signify  in  respect  of 
the  territory  which  it  occupies  ?  Could  one,  for  instance, 
estimate  the  importance  of  the  United  States  merely  from  the 
point  of  view  of  their  agricultural  and  mineral  wealth,  with- 
out taking  into  account  the  work  and  the  character  of  the 
admirable  Anglo-Saxon  race,  which  has  adapted  itself  to 
American  soil,  and  has  succeeded  in  obtaining  from  it  its  full 
value  ? 

*  We  must  here  explain  that  the  Argentine  possesses  two  currencies:  the 
piastre  or  dollar,  whose  value  is  5  francs,  and  the  paper  piastre,  which  by  the 
law  of  conversion  is  equivalent  to  2  francs  20,  or  Is.  7  •2d. 

As  for  weights  and  measures,  the  decimal  metric  system  has  been  adopted. 
In  surveying  large  areas,  the  square  league  is  occasionally  employed  as  unit, 
which  contains  2500  hectares,  or  .5628  acres  =  about  9|  square  miles. 

We  should  also  explain  that  the  Argentine  Republic,  of  which  the  Federal 
capital  is  Buenos  Ayres,  is  divided  into  fourteen  autonomous  Provinces  and 
ten  national  Territories.  The  Provinces,  in  the  order  of  population,  are  as 
follows:  Buenos  Ayres,  Santa  Fe,  Cdrdoba,  Entre  Rios,  Corrient^s,  Tucuman, 
Santiago  de  I'Estero,  Mendoza,  Salta,  Catamarca,  San  Juan,  San  Luis,  La  Rioja, 
and  Jujuy. 

The  national  Territories   are  :     La  Pampa,  Mision^s,  Nequen,  Rio  Negro, 
Ohaco,  Formosa,  Chubut,  Santa  Cruz,  the  Andes,  and  Tierra  del  Fuego 
59 


60      THE  ARGENTINE  IN  THE  20th  CENTURY 

And  could  we  explain  the  fact  that  certain  countries  of 
South  America,  which  also,  thanks  to  their  natural  wealth, 
have  all  the  elements  of  rapid  development,  have  remained 
stationary,  and  hardly  count  as  nations,  if  the  question 
of  race  did  not  throw  light  on  the  mystery,  showing  us 
that  with  the  most  favourable  factors  of  the  soil,  a  ferment 
is  essential  to  start  the  growth  of  the  seed  ? 

Concerning  the  Argentine,  this  then  is  the  problem  which 
we  have  to  consider,  if  we  wish  to  see  further  than  the 
present  moment,  and  to  judge  in  what  measure  its  progress 
may  be  consolidated  and  even  accelerated.  In  other  terms, 
we  must  understand  whether  the  Argentine  must  depend  upon 
a  fortuitous  grouping  of  individuals  brought  together  by  the 
various  streams  of  immigration,  and  having  no  common  tie 
but  the  desire  to  enrich  themselves,  or  whether  these  various 
elements  are  destined  to  become  fused,  and  in  time  to  form 
a  true  nationality,  with  its  own  traditions,  its  own  ideal. 

This  latter  is  naturally  the  end  to  be  pursued  by  the 
Argentine  Government,  if  it  wishes  to  prepare  for  the  future 
by  making  moral  and  material  progress  go  hand  in  hand. 
Its  role  is  not  to  manage  the  country  like  a  directing 
syndicate,  but  to  direct  all  individual  efforts,  all  initiative, 
and  all  other  available  forces,  to  the  same  national  and 
patriotic  end. 

It  was  this  idea  that  a  President  of  the  Republic,  Sefior 
Quintana,  felt  it  his  duty  to  enunciate,  when,  upon  assuming 
the  Presidential  authority,  he  stated,  in  his  inaugural 
message :  "  I  am  the  head  of  a  nation  which  has  in 
America  an  ideal";  and  he  added:  "There  is  one  common 
characteristic  among  us  that  was  discovered  as  early  as  the 
colonial  period,  in  the  magnitude  of  plans  of  campaign,  in 
the  clamour  of  intestine  conflict,  in  the  government  of 
the  constitutional  period;  it  is,  that  we  all  bear  in  our  hearts 
the  sense  of  our  future  greatness." 

How  far  can  these  aspirations  be  translated  into  facts? 
That  is  a  question  we  must  examine  seriously  and  with 
an  absolutely  unbiassed  judgment. 

We  cannot  study  this  question  of  the  Argentine  nation- 
ality in  books;  for  a  country  which  has  been  so  rapidly 
carried   awa}^    on   the    tide   of    material   progress    has   but 


NATIONALITY  61 

little  time  to  examine  itself.  Neither  has  it  been  able 
to  form  a  literature  or  a  sociology  which  might  reflect  the 
dominant  characteristics  of  the  generation ;  it  is  only  by 
an  inquiry  and  an  analysis  of  the  facts  that  we  can  isolate 
this  element  of  nationality  from  the  various  foreign  elements 
which  have  contributed  to  its  formation. 

One  factor  that  facilitates  our  task  is  the  clear-sighted- 
ness of  the  Argentines  themselves,  who  are  the  first  to 
recognise,  with  abundant  good-temper,  their  own  short- 
comings. They  are  almost  exaggerated  in  their  self-criticisms 
when  depicting  themselves ;  and  our  work  has  been  cut  out 
for  us  in  avoiding  too  hasty  generalisations  and  in  softening 
certain  too  rigorous  judgments,  although  these  emanated 
from  men  who  were  certainly  in  a  position  to  understand 
the  tendencies  of  their  generation. 

One  principle  dominates  the  whole  question :  it  is  that 
which  a  contemporary  historian  expresses  in  these  tei-ms : 
"  When  peoples  come  into  contact  they  begin  by  an  exchange 
of  their  faults."  Such  an  observation  might  well  apply 
to  a  people  like  the  Argentines,  who  are  not  yet  settled 
on  their  own  foundations,  and  are  constantly  increased  by 
immigration. 

All  the  varieties  of  the  Latin  race  have  contributed  to 
form  this  people :  Spain  and  Italy  have  made  the  largest 
contributions,  and  France  has  also  in  her  time  contributed 
her  share.  The  Argentine  has  even  assimilated  a  Basque 
population,  of  especial  interest  on  account  of  its  aptitude 
for  agricultural  work,  and  its  adaptability  to  its  new 
surroundings. 

Finally,  the  Anglo-Saxons  have  also  entered  the  Argentine, 
to  mingle  with  the  Latin  element,  and  have  given  great 
assistance  in  opening  up  the  country,  by  setting  an  influential 
example  of  initiative,  progress,  and  energy.  This  penetra- 
tion of  the  Latin  race,  a  little  indolent  and  inactive  as  it  is, 
by  the  energetic  and  progressive  Anglo-Saxons,  enables  us 
the  better  to  understand  the  good  and  bad  qualities  of  the 
Argentine  nationality. 

In  short,  if  we  are  to  obtain  an  unbiassed  view  of  the 
national  physiognomy  of  this  adolescent  people,  we  must 
remember  that  its  good    qualities,    like    its   faults,   are  the 


62      THE  ARGENTINE  IN  THE  20th  CENTURY 

result  of  the  commingling  of  the  varied  elements  which  have 
entered  the  country  by  immigration;  elements  that  have 
mixed  and  reacted  upon  each  other,  so  that  their  dominant 
characteristicshave  finally  appeared  in  the  Argentine  character. 

There  is  one  gift  which  we  cannot  deny  this  people : 
intelligence,  joined  to  a  remarkable  power  of  assimilation. 
It  also  has  that  gift  of  enterprise,  that  sense  of  progress, 
which  are  found  in  the  Anglo-Saxon  races,  and  which  have 
found  such  magnificent  scope  in  the  United  States. 

A  young  nation,  without  a  past,  the  Argentine  is  not 
impeded,  like  most  of  the  Latin  nations,  by  a  load  of  custom, 
prejudice,  and  routine,  hampering  its  motions  and  impeding 
its  progress.  Profiting  by  the  experience  of  others,  it 
knows  how  to  adapt  itself  to  the  best ;  taking  its  good 
wherever  it  finds  it.  It  creates  nothing,  invents  nothing,  but 
appropriates  all  new  ideas,  which  find  upon  its  soil  the 
conditions  favourable  to  a  rapid  expansion.  It  is,  indeed, 
formed  after  the  likeness  of  its  own  soil,  which  produces 
without  eflfort  and  lends  itself  admirably  to  every  kind 
of  culture. 

This  sense  of  progress  is  certainly  the  most  characteristic 
trait  of  the  Argentine,  and  the  one  by  which  it  is  distinguished 
among  the  other  Latin  nations  of  South  America.  Uruguay, 
for  example,  which  possesses  a  soil  as  rich,  and  offers  the 
same  facility  of  transport,  has  given  no  proofs  of  initiative 
and  vitality  to  lead  one  to  hope  that  she  has  really  entered 
upon  the  path  of  progress.  It  is  the  same  with  Paraguay 
and  many  other  States,  which  have  not  succeeded  in  ac- 
complishing any  of  the  changes  demanded  by  modern 
civilisation. 

The  Argentine,  on  the  contrary,  has  always  known  how 
to  derive  benefit  from  whatever  source  was  available,  thanks 
to  the  current  of  immigration  which  keeps  it  in  permanent 
touch  with  foreign  countries.  It  has  also  assimilated  the 
inventions  and  the  methods  of  more  civilised  nations,  and 
has  attracted  men  capable  of  applying  them.  At  the  head 
of  the  great  administrations  of  the  State,  one  often  finds 
specialists  from  Europe  or  the  United  States,  who  bring  the 
fruits  of  their  experience,  and  increase  the  intellectual 
possessions  of   the   nation.     The   departments   of   railroads, 


NATIONALITY  63 

navigation,  public  works,  and  hygiene,  thanks  to  these  happy- 
selections,  offer  every  security  of  efficiency  in  operation. 

One  may  say,  it  is  true,  that  this  is  the  result  of  foreign 
influence  ;  but  what  does  the  origin  of  all  these  improvements 
signify  in  respect  of  the  future,  so  long  as  they  become 
incorporated  in  the  life  of  the  Argentine  and  contribute  to 
its  evolution  ?  One  thing  which  proves  that  the  instinct  for 
progress  is  at  the  heart  of  the  national  tenipei-ament  is 
that  it  is  found  in  the  lower  strata  of  certain  public  services 
in  which  the  foreign  element  plays  no  part.  The  administra- 
tion of  the  police,  for  instance,  and  that  of  the  posts  and 
telegraphs,  to  cite  no  other  examples,  are  conducted  with  as 
great  a  regularity  as  in  any  European  country. 

Thus,  while  allowing  that  the  initiative  of  all  improve-     ^ 
ments   comes  from  abroad,  we  must  not  overlook  the  factt^ 
that  the  Argentine  has  assimilated  them  with    the   utmost 
facility,  and  that   this   gift   of   assimilation  forms  to-day  a 
valuable  portion  of  the  national  patrimony. 

Despite  its  eminently  cosmopolitan  character,  which  is 
a  peculiarity  of  its  development,  the  Argentine  Republic  / 
has  succeeded  in  retaining  its  own  personality  among  so 
many  diverse  elements.  It  is  the  type  of  the  modern  nation, 
whose  ideal  is  that  of  the  United  States — business.  A  man 
is  zonzo  or  vivo — a  fool  or  more  than  capable — there  is  no 
medium. 

From  this  point  of  view  the  Argentine  is  at  the  apex  of 
its  period  ;  it  has  no  use  for  abstract  ideas  or  immortal 
principles ;  its  ambition  being  above  all  to  sell  its  corn  and 
cattle  and  to  enrich  itself.  Behind  the  agitation  of  the 
political  parties  there  is  no  other  object  than  this :  to  share  in 
the  exploitation  of  the  country  and  to  enjoy  its  wealth.  The 
heroic  period  is  over  for  the  Argentine ;  its  independence  is 
to-day  definitely  assured ;  it  pursues  no  dreams  of  conquest 
now,  but  seeks  only  pacific  victories  for  its  products  in  the 
great  international  markets. 

Prosaic  as  the  present  generation  is,  it  is  not,  from  our 
point  of  view,  completely  without  nobility  ;  it  loves  its  native 
soil  and  glorifies  it ;  not,  assuredly,  after  the  fashion  of  Virgil 
saluting  the  Latin  soil,  fertile  of  heroes,  but  as  a  land  produc- 
tive of  rich  harvests,  and  the  source  of  material  prosperity. 


64      THE  ARGENTINE  IN  THE  20th  CENTURY 

This  it  is  that  explains  the  powerful  attraction  which  the 
Argentine  exercises  upon  all  those  who  have  trodden  its  soil. 
The  country  progresses  with  such  rapidity,  the  value  of  the 
soil  increases  in  such  proportions,  that  the  most  indifferent 
end  by  being  drawn  into  the  stream.  Those  who  come  to 
live  here  without  any  idea  of  final  residence  make  up  their 
minds  to  settle  as  soon  as  they  hold  the  smallest  parcel  of 
property.  When  a  man  has  lived  some  little  time  in  the 
Argentine,  and  has  watched  the  spectacle  of  its  rapid 
development,  he  is  quickly  seized  by  the  business  vitality 
which  forces  him  to  take  part  in  the  great  movement. 

This  love  of  the  Argentine  for  his  land  may  certainly 
have  its  noble  side,  but  he  knows  nothing  of  the  moving 
spirit  of  poetry  which  clothes  that  love  in  the  old  countries 
of  Europe,  where  man  becomes  attached  not  only  to  the 
cultivable  land,  but  to  all  the  memories  of  the  native  village ; 
the  familiar  hills  and  meadows,  the  old  church,  and  all  that 
puts  us  into  communication  with  the  soul  of  places.  It 
would  seem  as  though  one  holds  more  closely  to  the  earth 
that  demands  the  most  labour,  the  greatest  efforts,  even  the 
greatest  disappointments. 

No  one  was  ever  more  attached  to  the  land  than  the  Boer, 
who  lived  at  peace  in  an  ungrateful  soil,  indifferent  to  the 
mineral  wealth  which  it  might  conceal.  It  was  this  land, 
where  he  lived  an  independent  life,  that  he  defended  so 
stubbornly  ;  not  the  gold,  which  was  yet  the  true  wealth  of 
the  country. 
Y  The  Argentine  also  has  seen  pass  over  its  soil  the  same 
rude  generation,  having  no  other  dream  than  independence. 
The  "  guacho "  of  old,  a  mixed  type  of  the  Indian  and 
Spanish  races,  the  true  son  of  the  pampa,  was  truly  attached 
to  the  immense  plain  upon  which  he  lived  at  the  call  of 
caprice,  a  wild  rider  in  every  sense.  To-day  the  type  tends 
to  disappear,  as  civilisation,  and  more  especially  administra- 
tion, everywhere  make  their  influence  felt ;  as  the  ancient 
virgin  pampa  is  transformed  into  cultivable  soil,  bristling 
on  all  hands  with  barbed  wire.  As  he  was  not  easy  to 
domesticate,  nor  break  in  to  any  continuous  labour,  the 
"guacho"  has  been  supplanted  little  by  little  by  the  foreign 
farmer,  the  colonist ;   and  to-day  he  is  almost  submerged  by 


\/ 


NATIONALITY  65 

the  wave  of   immigration    which  has   invaded    the  country, 
and  which  forms  now  tlie  major  part  of  the  population. 

From  the  men  of  this  new  generation  one  must  ask  no  other 
love  for  the  soil  than  that  which  is  born  of  the  profits  they 
draw  from  it.  They  can  move  indifferently  from  north  to 
south,  from  east  to  west ;  the  soil  for  them  is  everywhere 
the  same,  provided  the  harvest  be  good.  But,  apart  from  that, 
they  nevertheless  love  this  land  of  promise,  and  interest 
makes  them  its  children. 

From  this  generation,  whose  principal  traits  we  liave 
noted,  it  seems  that  we  may  in  the  future  expect  great  things. 

To  be  sure,  if  the  world  were  to  return  to  its  old  ideal, 
that  of  glory  or  imperialism,  we  hardly  know  what  place  the 
Argentine  would  find  in  the  scheme  of  things.  It  is  unsuited 
to  a  military  policy ;  it  has  no  ambition  to  measure  itself 
with  neighbouring  nations,  which  are  far  more  eager  for 
adventure. 

But  if  we  stand  on  the  economic  plane,  the  only  one  which 
interests  us,  we  must  alfew  that  this  generation  is  well 
armed  for  self-defence  in  every  field  of  the  commercial 
struggle.  From  the  fusion  of  the  Latin  genius  with  the 
Anglo-Saxon  energy  has  issued  a  new  product,  extremely 
capable  in  business,  full  of  practical  sense,  and  very  open  to 
progress,  which  will  be  fully  able  to  hold  its  own  in  a  century 
in  which  money  is  the  great  instrument  of  domination.  This 
race,  formed  haphazard  of  immigration,  is  yet  the  very  race 
for  Argentine  soil ;  between  the  two  there  is  a  correspond- 
ence, an  adaptation,  as  perfect  as  if  it  were  the  result  of 
long-continued  design. 

To  sum  up :  the  Argentine  nationality  appears  to  a 
foreigner  under  two  distinct  aspects:  there  is  its  political 
side,  characterised  by  instability  and  lack  of  organisation, 
and  the  economic  side,  in  which  an  intense  national  life  and 
progress  are  manifested.  Will  this  truly  abnoi-mal  situation, 
containing  both  very  bad  and  very  good  elements,  perhaps, 
terminate  favourably,  making  of  the  Argentine  people  not 
merely  a  rich,  but  also  a  great  nation  ?  Will  the  develop- 
ment of  public  aff'airs,  left  so  far  to  the  hazard  of  politics, 
even  reach  the  plane  of  our  economic  development?  Will 
the  Argentine  nation  eliminate,  under  the  pressure  of  material 


66      THE  ARGENTINE  IN  THE  20th  CENTURY 

progress,  the  leaven  of  anarchy  left  behind  by  a  century  of 
civil  dissension  ?  This  is  the  secret  of  the  future  ;  this  is  the 
great  achievement  which  remains  to  be  accomplished  in 
order  to  consolidate  the  present  prosperity  of  the  country. 

In  short,  we  must  not  lose  sight  of  the  fact  that  this 
prosperity  has  hitherto  been  less  the  work  of  man  than  of 
nature,  which  has  been  prodigal  of  her  gifts  to  this  fortunate 
land.  This  is  a  thought  which  has  been  expressed  in  a 
speech  in  the  Argentine  Senate,  in  which  Senator  Uriburu 
shows  that  Providence  is  always  coming  to  the  rescue  by 
repairing  the  fault  of  the  State. 

"  It  is  Providence,"  he  says,  "  which  so  opportunely  sends 
us  the  rains  to  water  our  lands  and  to  raise  our  marvellous 
crops;  it  is  Providence  that  has  given  us  the  greatest 
Minister  of  Finance  we  Have  ever  known,  our  fertile  soil  and 
our  clear  sky;  the  supreme  Minister  who  looks  after  all  our 
needs,  who  saves  us  from  all  difficulties,  and  who,  despite 
our  errors,  continues  to  ensure  the  greatness  of  the  Republic. 
Let  man  appropriate  his  work,  but  let  him  render  unto  Caesar 
that  which  is  Caesar's." 

And  now  if  by  some  impossibility  the  situation  were  to 
change :  if  in  spite  of  the  enormous  extension  of  cultivated 
Aands  a  period  of  bad  harvests  were  to  follow  the  present 
/  period  of  fat  cattle  :  would  there  not  be  reason  to  fear  that  the 
whole  national  edifice,  founded  as  it  is  on  prosperity,  might 
become  disintegrated,  and  crumble  under  the  stroke  of 
adversity  ?  This  is  the  peril  we  must  indeed  seek  to  avoid  ; 
it  is  for  this  reason  that  the  intervention  of  a  strong  power 
seems  necessary,  in  order  to  restrain  the  germs  of  evil  brought 
by  so  many  races,  and  to  prevent  the  Argentine  from  falling 
back  into  the  state  of  anarchy  and  revolution  which  for  her 
is  only  a  distant  memory. 

Taking  even  a  more  elevated  standpoint,  we  may  add 
that  in  order  to  amalgamate  all  the  elements  of  immigration 
and  to  attach  them  to  the  country,  through  good  and  evil 
fortune,  we  need  another  solvent  than  personal  interest  or 
profit.  To  create  a  people  it  may  suffice  to  give  it  a  body, 
but  to  make  it  live  it  must  also  be  given  a  soul,  at  whose 
breath  the  collectivity  of  individuals  will  be  transformed 
into   that  moral   unity  which  we   call   the   nation.     This  is 


NATIONALITY  67 

a  question  of  prime  importauce  in  a  country  such  as  the 
Argentine,  where  the  struggle  for  existence  has  taken  a 
particularly  keen  form,  which  scarcely  favours  the  develop- 
ment of  disinterested  sentiments. 

It  is  for  the  State  to  develop  among  its  people  this'^''^ 
national  idea,  and  to  turn  all  individual  efforts  to  its  profit. 
Its  duty  is  to  raise  its  authority  above  the  medley  of  interest, 
to  restrain  ambition  within  a  just  limit  by  the  influence  of 
moral  and  patriotic  ideas,  and  so  to  ensure  the  reign  of 
justice  and  social  peace,  without  which  national  prosperity 
will  never  be  more  than  ephemeral. 

In  imagining,  from  this  aspect,  the  formation  of  a 
nationality,  we  have  no  intention  of  criticising  the  country  ; 
still  less  do  we  deny  the  process  of  evolution  which  has 
gradually  transformed  its  organis'ation.  A  nation  is  not 
created  in  a  day,  especially  when  it  is  a  question  of  a  country 
so  young  as  the  Argentine,  which  in  less  than  a  century  has 
issued  from  the  struggle  for  independence,  and  even  to-day 
has  hardly  rid  itself  of  the  revolutionary  spirit. 

For  a  nation  to  become  self-conscious,  centuries  must  pass ; 
traditions  must  be  formed,  and  the  great  moral  or  intellectual 
forces  of  humanity — religion,  science,  literature,  even  poetry 
— must  develop  the  sense  of  a  collective  life  other  than 
the  life  of  business.  And  hitherto  the  Argentine  has  had 
no  time  to  produce  generations  of  thinkers,  philosophers, 
and  historians ;  still  less  poets.  The  most  it  has  are 
statisticians,  who  give  it  the  precise  figures  of  her  com- 
mercial balance. 

We  do  not  doubt,  however,  that,  thanks  to  material 
progress,  this  slow  elaboration  of  a  new  race  will  eventually 
be  completed.  In  the  first  phase  of  her  existence  as  a  nation 
Argentina,  according  to  the  spirit  of  her  Constitution, 
fraternally  opened  her  doors  to  all  who  wished  to  inhabit 
her  soil.  No  restriction  was  placed  upon  the  entry  nor  on 
the  permanent  immigration  of  foreigners ;  on  the  contrary, 
legislation  and  social  customs  combined  to  favour  immigra- 
tion. The  result  is,  that  the  new  arrivals  have  regarded 
themselves  as  alien,  in  matters  of  economics  and  politics,  to 
the  nationality  with  which  they  have  become  incorporated  ; 
believing  that  their  mission  consisted  solely  in  creating  and 


68      THE  ARGENTINE  IN  THE  20th  CENTURY 

circulating  wealth,  while  regarding  the  solution  of  the  great 
national  problems  with  indifference. 
\  But  to-day  the  Argentine  has  entered  upon  a  new  phase ; 
it  must  no  longer  merely  receive,  it  must  also  incorporate 
all  these  elements  of  immigration,  and,  without  awakening 
antagonism  towards  the  foreigner,  it  must  set  to  work  to 
absorb  him  into  the  soul  of  the  nation. 

This  faculty  of  assimilation  is  a  virtue  of  the  American 
soil.  The  United  States  have  proved  as  much  for  North 
America,  and  it  now  remains  for  the  Argentine  to  do  the 
same  for  South  America.  The  new  generation  of  immigrants, 
having  struck  root  into  its  hospitable  soil,  must  live 
completely  in  the  national  life,  absorbing  those  feelings 
of  patriotism  which  animate  the  new  citizen  of  the  United 
States. 

To  give  expression  to  these  loyalist  tendencies,  we  will 
confine  ourselves  to  quoting  the  memorable  words  which 
were  spoken  in  the  Congress  of  Wisconsin,  by  an  American 
congressman,  born  in  Germany,  the  Hon.  Richard  Glinther; 
words  which  were  equally  applauded  and  approved  in  Latin 
America.  We  shall  perceive,  through  the  very  exaltation  of 
his  phrases,  what  unreserved  devotion  a  naturalised  foreigner 
may  bring  to  his  new  country : 

"  We  know  as  well  as  any  other  class  of  American  citizens 
where  our  duty  lies.  We  labour  for  our  country  in  times 
of  peace,  and  we  shall  fight  for  her  in  time  of  war,  if  ever 
such  time  arrive.  When  I  say  our  country,  I  naturally 
mean  our  country  of  adoption,  the  United  States  of  America. 
After  passing  through  the  alembic  of  naturalisation  we  are 
no  longer  Germans  ;  we  are  Americans.  Our  attachment  to 
America  cannot  be  measured  b}^  the  length  of  our  residence 
here.  We  are  Americans  from  the  moment  when  we  reach 
the  American  shore,  until  the  day  when  we  are  laid  to  rest 
in  an  American  grave." 


PART    1 

THE   AKGENTINE    FROM    THE    ECONOMIC 
STANDPOINT 


CHAPTER  I 

THE  GEOGRAPHY  OF  THE  ARGENTINE 

Climatb — Soil — Geographical  situation  of  the  Argentine ;  its  boundarioB, 
its  area. 

Climate  of  various  districts.  The  prevailing  winds.  Nature  of  the  soil ;  its 
fertility;  adaptation  to  the  oulture  of  cereals  and  the  raising  of  live- 
stock— Transformation  of  virgin  into  fertile  land  —The  Pampa — The 
cultivable  area — Conditions  favourable  to  production — The  plagues  of 
locusts. 

Rivers — Their  exceptionally  favourable  influence — The  hydrographic  system — 
Network  of  navigable  river-ways  :  the  Rio  de  la  Plata,  the  Rio  Parana — 
Conditions  of  navigability — Canals. 

Ports — List  of  the  principal  ports,  with  a  summary  of  their  trade — Buenos 
Ayres:  description  of  the  port,  its  area,  its  capacity,  tonnage  ;  its  docks — 
The  Central  Produce  Market — Importance  of  Buenos  Ayres  in  comparison 
with  the  great  ports  of  the  world — The  port  of  La  Plata — The  port  of 
Rosario ;  increase  of  its  traffic ;  construction  of  the  new  harbour 
conceded  to  a  French  company — Bahia  Blanca ;  its  development — The 
decentralisation  of  traffic. 

THE  Argentine  Republic  occupies  the  southern  extremity 
of  South  America  and  runs  from  north  to  south  from 
21°  30'  to  54°  52'  of  south  latitude  ;  or  33°  in  a  meridian 
line.  From  east  to  west  it  occupies  a  width  of  20°,  between 
54°  and  74°  of  longitude. 

Its  territory  is  bounded  to  the  north  by  Bolivia  and 
Paraguay;  to  the  east  by  Brazil  and  Uruguay;  to  the 
west  by  Chili.  Its  boundaries  by  land  are  2980  miles  in 
extent  on  the  west ;  993  miles  on  the  north ;  the  river 
boundaries  on  the  east  are  745  miles  in  length.  Finally,  the 
shores  of  the  estuary  of  the  Rio  de  la  Plata  and  the  Atlantic 
form  a  stretch  of  1614  miles;  all  of  which  represents  a 
total  boundary-line  of  about  6334  miles. 

The  superficial  area  of  the  Republic  has  not  hitherto 
been  calculated  on  the  basis  of  a  geodesical  survey ;  it  has 
been  arrived  at  only  by  calculation  from  charts  which  are 
more  or  less  approximate.  According  to  the  estimates  most 
worthy  of  credence,  and  allowing  for  the  latest  rectifications 
71 


72      THE  ARGENTINE  IN  THE  20th  CENTURY 

of  the  frontier,  its  present  area  is  equivalent  to  11,328,321 
square  miles.  This  is  about  six  times  the  area  of  France, 
which  contains  only  203,905  square  miles.  The  Province 
of  Buenos  Ayres  alone  is  more  than  half  as  large  as  France. 

The  seasons  in  the  Argentine,  compared  to  those  of  the 
northern  hemisphere,  are  of  course  reversed.  The  summer 
corresponds  to  December,  January,  and  February ;  the 
autumn  to  March,  April,  and  May ;  the  winter  to  June,  July 
and  August ;  and  the  spring  to  September,  October,  and 
November. 

In  the  matter  of  climate,  the  Argentine  may  be  divided 
into  three  regions;  those  of  the  coast,  the  centre,  and  the 
Andes. 

The  coastal  region  comprises  the  Provinces  of  Buenos  Ayres, 
Santa  F^,  Entre  Rios,  and  Corrientes.  The  average  annual 
temperature  is  about  66*2°  Fahr. ;  at  Buenos  Ayres  it  is  only 
62'6°.  The  average  summer  temperature  is  about  77°,  that  of 
the  autumn  64*4° ;  of  the  winter,  53"6°,  and  of  the  spring, 
62*6°.  The  hottest  month  is  January,  when  the  average  is 
77°;  the  coldest  is  July,  with  an  average  of  51  "8°. 

In  this  coastal  region  the  extremes  of  temperature 
are  1076°  in  summer  and  41°  in  the  winter;  but  these 
temperatures  are  both  exceptional.  However,  a  temperature 
of  95°  is  very  usual  on  summer  afternoons.  It  is  a  very 
unusual  thing  for  the  mercury  to  fall  below  freezing-point 
in  winter  or  to  remain  there.  Snow  is  also  a  very  rare 
phenomenon,  only  to  be  seen  perhaps  once  in  five  years. 

A  peculiarity  of  the  Argentine  climate  in  general  is  that 
the  temperature  will  change  very  rapidly  during  the  day,  or 
even  during  a  few  hours ;  the  change  representing  sometimes 
a  difference  of  more  than  36°,  especially  in  the  spring,  which 
is  the  most  usual  season  for  these  rapid  variations. 

The  climate  of  the  coast  region — that  is,  of  a  country  con- 
sisting almost  entirely  of  plains — is,  in  general,  influenced  by 
the  winds,  which  blow  in  gales  at  all  seasons.  Northerly 
and  southerly  gales  are  the  most  common ;  the  first  especi- 
ally are  very  frequent.  In  Buenos  Ayres  one  finds,  during 
the  summer,  an  alternation  of  sea  and  land  breezes ;  the  one 
during  the  day,  the  other  during  the  night. 

The  northerly  winds  are  always  hot  and  even  suflTocat- 


THE  GEOGRAPHY  OF  THE  ARGENTINE      73 

ing  ;  they  influence  the  nervous  system,  afflictinrj  some  people 
with  neuralgic  troubles.  When  these  winds  blow,  the  air  is 
charged  with  electricity,  until,  the  tension  of  the  atmosphere 
having  grown  insupportable,  a  tempest  comes  to  restore  the 
equilibrium,  to  give  place  to  another  wind,  coming  from  the 
south-west,  and  known  as  the  pampero.  This  wind  does  not 
often  last  long,  but  it  attains  a  velocity  equal  to  that  of  a 
full  hurricane.  The  pampero,  so  called  because  it  is  formed 
in  the  region  of  the  pampas,  is  a  wind  full  of  ozone,  and  as 
such  plays  its  part  in  disinfecting  the  vitiated  air  of  the  urban 
centres.  But  the  effects  of  the  pampero,  and  especially  of  the 
south-westerly  winds,  on  the  Rio  de  la  Plata,  where  they 
produce  a  violent  swell,  are  sometimes  terrible. 

As  for  the  rain,  there  is  no  regularity  in  its  fall ;  which 
naturally  tends  to  render  the  results  of  culture  and  of  cattle- 
breeding  variable.  Rains  are  more  frequent  in  summer  and 
autumn  than  at  other  times ;  while  the  least  rainfall  is  that 
of  winter.  At  Buenos  Ayres  it  is  rare  for  a  month  to  pass 
without  rain,  which  is  often  torrential,  and  accompanied  by 
hail. 

The  climate  of  the  central  region,  if  we  except  the  moun- 
tainous portions  of  the  Provinces  of  San  Luis  and  Cordoba,  is 
distinguished  from  the  seaboard  region  by  its  greater  dryness 
and  its  sudden  variations  of  temperature.  In  the  plain  the 
summers  are  very  hot,  and  it  is  not  uncommon  to  see  the 
thermometer  at  104°  ;  while  during  the  winter  there  are  very 
hard  frosts.  As  on  the  coast,  northerly  and  southerly  winds 
are  the  most  frequent.  Rain  is  rarer  than  on  the  coast,  and 
falls  almost  exclusively  in  summer  and  in  autumn  :  with 
rare  exceptions  the  winter  is  perfectly  dry. 

In  the  Andean  region  the  climate  varies  according  to  the 
height  above  sea-level,  but  is  always  characterised  b}^  sudden 
variations  in  the  daily  temperature,  and  by  excessive  dry- 
ness. On  the  eastern  slope  of  the  Andes  and  the  plateaux  of 
the  north  it  never  rains.  These  regions  are  c(jntinually 
swept  by  furious  winds,  which  make  agriculture  impossible. 
To  the  intense  heat  of  the  day  succeeds  the  cold  of  the  night, 
with  differences  of  temperature  that  sometimes  amount  to 
68°  in  twenty -four  hours. 

The  climate  of  the  Argentine,  with  a  few  exceptions,  has 


74      THE  ARGENTINE  IN  THE  20th  CENTURY 

the  reputation  of  being  extremely  healthy,  on  account  of  the 
sudden  changes  of  temperature  and  the  dryness  of  the  air 
predominant  over  the  greater  part  of  the  country.  These 
atmospheric  conditions  are,  to  be  sure,  not  favourable  to 
affections  of  the  lungs  ;  but,  on  the  other  hand,  they  contribute 
to  prevent  epidemics.  We  find  that  among  adults  and  adoles- 
cents the  figures  of  mortality  are  no  higher  than  the  average 
figures  for  the  healthiest  countries  in  the  world.  The 
statistics  drawn  up  by  the  City  of  Buenos  Ayres  even  show 
that  foreigners  have  a  longer  expectation  of  life  than  the 
indigenous  population. 

In  matters  of  climate  one  must  be  careful  not  to  become 
confused,  as  so  many  Europeans  do,  between  our  Argentine 
Republic  and  the  neighbouring  country  of  Brazil,  which  is 
nearer  the  equatorial  zone.  Favourable  to  human  health, 
the  Argentine  climate  is  also,  as  we  shall  see,  particularly 
favourable  to  most  kinds  of  agriculture  and  to  the  breeding 
of  cattle ;  from  this  point  of  view  it  is  a  privileged  land, 
which  calls  only  for  labour  to  become  productive. 

For  a  greater  part  of  its  area  the  Argentine  soil  unites 
the  geological  and  climatic  conditions  favourable  to  the  pro- 
duction of  cereals  and  for  stock-raising.  It  is  in  the  fertility 
of  the  cultivated  lands  and  the  richness  of  the  pastures  that 
the  whole  economic  value  of  the  country  resides. 

According  to  recent  investigations  by  competent  persons, 
the  surface  of  the  Argentine  is  largely  composed  of  sandy 
soil  ;  but  a  sandy  loam  is  often  found,  also,  more  rarely,  a 
gravelly  clay ;  but  there  is  very  little  actual  clay.  Other 
soils,  such  as  absorbent  calcareous  earth,  are  not  often  found. 
In  the  subsoil  a  sandy  clay  abounds,  the  occurrence  of  clay 
and  calcareous  earths  being  greater  in  the  subsoil  than  in  the 
soil. 

From  the  chemical  point  of  view,  the  high  percentage  of 
potash — which  remains  practically  undiminished — long  ago 
attracted  the  attention  of  the  agronomist.  Phosphoric  acid 
is  also  found,  though  in  less  proportions.  Lime  is  often 
found  in  small  quantities  in  the  best  soils  in  those  districts 
most  devoted  to  agriculture  ;  and  nitrogen  is  often  abundant, 
except  in  the  southern  region  of  the  Republic,  and  in 
some  parts  of  the  western  region,  where  the  rains  are  less 


THE  GEOGRAPHY  OF  THE  ARGENTINE   75 

frequeut,  the  winds  violent,  and  the  vegetation  poor  and 
stunted. 

(Saltish  soils  are  of  frequent  occurrence  in  the  west  and 
south,  but  in  general  the  salt  is  not  in  sufficient  proportions 
to  hinder  agriculture,  especially  when  suitable  means  of 
culture  are  employed. 

Soils  of  great  fertility  are  found  in  the  central  and 
southern  regions,  and  occupy  vast  areas  in  the  Provinces  of 
Buenos  Ayres  and  Santa  Fe,  and  in  parts  of  Cordoba  and 
Entre  Rios.  "  There  are  areas  which  are  apparently  of  poor 
fertility,"  says  M.  Charles  Girola,  from  whom  we  derive  these 
data,  "  which  yield  magnificent  crops,  thanks  to  irrigation  or 
a  better  distribution  of  the  water  supply ;  especially  in  the 
west  and  the  south."  * 

But  in  the  Argentine  Republic  experience  has  shown  that 
there  is  scarcely  any  soil  which  is  not  capable  of  profitable 
use,  either  for  agriculture  or  stock-raising.  It  is  very 
frequently  remarked  that  lands  which  for  a  long  time  had 
been  regarded  as  poor  and  almost  sterile,  unfit  for  exploita- 
tion, are  to-day  converted  into  admirable  natural  or  artificial 
prairies,  feeding  numerous  herds  of  sheep  or  cattle ;  or  have 
more  often  been  cleared  by  the  colonist,  and  are  now  yielding 
excellent  crops.  This  wonderful  transformation  is  chiefly 
due  to  the  pasturing  of  flocks  and  herds,  which  break  up  and 
enrich  the  soil ;  also  to  the  fertilising  organic  matter  contained 
in  the  turf ;  and  finally  to  the  addition  of  innumerable 
dead  insects,  which  are  brought  by  the  wind  and  form  a 
deposit  on  the  soil,  which  acts  as  a  kind  of  natural  manure. 

These  favourable  conditions  of  fertility  are  all  united  in 
the  region  known  as  the  Pampa,  which  occupies  the  greater 
part  of  the  temperate  zone  of  the  country.  It  consists  of 
immense  and  virgin  plains,  which  stretch  to  the  horizon 
•almost  without  landmarks  or  changes  of  level,  and  offer 
admirable  opportunities  both  for  agriculture  and  stock- 
raising. 

Nearly  all  those  Argentine  lands  which  to-day  bring 
fabulous   prices   were   referred    to,   at  an  earlier  period,  as 

*  Invcstif/aci'jn  ayricoJa  en  la  RqnlhUca  Argentina,  by  Charles  Girola, 
Agronomic  Engineer,  Head  of  the  Agronomic  Bureau  in  the  Ministry  of 
Agriculture.     (1004). 


76      THE  ARGENTINE  IN  THE  20th  CENTURY 

"  lands  good  for  nothing."  For  this  reason  a  considerable 
premium  should  be  put  on  the  theoretical  estimate,  made  a 
priori,  of  the  areas  suitable  for  advantageous  cultivation,  in 
proportion  as  human  labour  works  its  transformation. 

It  is  difficult  to  estimate,  except  in  the  most  approximate 
manner,  the  cultivable  area  of  the  Argentine.  It  should 
be  not  less  than  half  the  total  area,  or,  in  round  figures,  370 
millions  of  acres.  Of  this  estimate  at  least  two-thirds 
represents  land  suitable  for  stock-raising,  leaving  available 
for  the  production  of  cereals  about  122  millions  of 
acres;  of  which,  at  the  present  time,  only  a  fifth  part  is 
under  cultivation.  We  may  see,  by  this  simple  comparison 
between  the  future  and  the  present,  that  agriculture  has  still 
a  great  future  before  it  and  a  large  margin  of  development. 

To  give  a  true  idea  of  this  power  of  production,  it  is  enough 
to  recall,  with  M.  Emile  Daireaux,  who  has  described  the 
great  farms  of  the  Argentine  pampa,  that  the  plough,  under 
the  most  favourable  of  climates,  meets  no  obstacles  in  the 
way  o"f  hills  or  forests ;  not  a  tree,  not  a  rock,  not  even  a 
pebble  in  the  soil.  All  European  crops  give  there  aji 
abundant  harvest,  without  expenditure  upon  manure,  with- 
out shelter  for  the  stock ;  the  colonist  may  even  content 
himself  with  a  modest  wattled  hut,  protecting  him  from  the 
mid-day  sun  or  the  cold  breeze  of  the  night.  The  soil  is 
everywhere  friable ;  no  painful  struggles  retard  the  speed  of 
the  plough,  which  traces  at  one  stretch  a  furrow  miles  in 
length  without  turning  the  ploughshare.  The  plough  is  drawn  , 
by  four  horses,  reared  at  hazard  in  the  open  air,  knowing  no 
grooming,  no  complicated  training ;  and  sometimes  a  single 
hand  is  able  to  manage  two  teams  and  ploughs. 

Thanks  to  the  frequentation  of  these  lands  for  centuries 
by  horses  and  cattle,  these  alluvial  deposits,  rich  in  natural 
manures,  have  an  apparently  inexhaustible  fertility,' 
Awakened  by  labour  from  its  eternal  sleep,  the  soil  is  so 
vigorous  that  one  finds  numerous  instances  where  the  same 
grain,  sown  for  twenty  successive  years  in  the  same  place, 
yields  always  the  same  abundant  harvest. 

The     only     serious    scourge     which     can     menace    the 
creative  power  of  the  earth,   independently  of  the   always  i 
to  be  dreaded  drought,  is  the  invasion  of  locusts. 


THE  GEOGRAPHY  OF  THE  ARGENTINE        77 

These  invasions  take  the  form  of  flying  armies  of  locusts 
passing  between  earth  and  sky,  and  revealing  their  passage 
by  the  serai-darkness  they  produce  in  the  regions  over 
which  they  travel.  Leaving  the  hot  deserts  of  the  tropical 
regions,  the  locusts  advance  in  their  phalanxes,  sometimes 
50  or  60  miles  across ;  swarm  succeeds  swarm  uninter- 
ruptedly for  several  days,  leaving  behind  them  no  trace  of 
vegetation.  They  fill  the  wells,  stop  the  trains,  by  opposing 
veritable  barriers  of  their  bodies,  obstruct  the  rivers  in  which 
they  drown,  and  sometimes  even,  by  the  accumulation 
of  their  bodies,  form  a  bridge  over  which  the  rear-guard  can 
pass. 

Serious  though  this  danger  may  be,  especially  in  the 
more  exposed  provinces,  such  as  Santa  Fe,  we  must  say,  in 
honour  to,the  Argentine  Republic,  that  it  has  never  paralysed 
initiative ;  as  is  proved  by  the  continuous  increase  in  the 
area  of  sown  soil.  Very  fortunately,  too,  this  plague,  like 
that  of  Egypt's  in  Pharaoh's  dream,  is  intermittent,  and  an 
interval  of  seven  years  often  passes  before  its  return.  More- 
over, various  means  are  being  put  into  practice  for  defence 
against  this  formidable  evil ;  means  for  preventing  the  re- 
production of  the  insect,  or  of  checking  its  development 
before  the  period  of  flight. 

A  special  organisation  has  been  formed  under  the  name 
of  the  "  Commission  of  Agricultural  Defence,"  in  order  to  co- 
ordinate and  direct  the  work  of  protection  from  the  devas- 
tations of  the  locust,  and  considerable  sums  are  devoted 
to  this  object  every  year.  Regiments,  mobilised  along  the 
line  of  passage,  sweep  the  agglomerated  masses  of  insects,  in 
dense  ridges,  towards  the  ditches  full  of  quicklime  in  which 
they  are  buried.  Hundreds  of  tons  of  locusts  perish  thus, 
but  unhappily  the  plague  seems  neither  cured  nor  diminished.* 


RiVEns 

The  economic  progress  of  the  Argentine  Republic  is 
intimately  connected  with  the  development  of  its  means  of 
communication,  its  trafiic-ways.     The  railways  and  the  ports 

*  See  Le  Correspondent  of  the  10th  of  February,  1905,  containing  an  article 
by  M.  Emile  Daireaux. 
F 


78      THE  ARGENTINE  IN  THE  20th  CENTURY 

have  been  the  chief  factors  of  the  country's  prosperity,  as  by 
facilitating  the  outlet  of  agricultural  products,  they  have 
allowed  the  soil  to  attain  its  whole  value.*  It  is  therefore 
pertinent  to  state,  in  some  detail,  how  the  Argentine  is 
equipped  from  this  point  of  view,  and  the  part  played  by 
such  equipment  in  the  commercial  development  of  the 
country. 

By  the  truly  providential  nature  of  its  soil,  the  Argentine  ^ 
is  not  only  marvellously  fertile,  but  is  also  a  country  largely  / 
opened  up  by  waterways,  and  offering  exceptional  facilities  \ 
from  the  point  of  view  of  international  exchange. 

One  of  the  most  notable  peculiarities  of  this  country  is 
that  its  rivers,  which  are,  as  it  were,  inland  seas,  accessible  to 
vessels  of  the  highest  tonnage,  and,  penetrating  the  very 
heart  of  the  most  fertile  regions,  place  it  directly  in  com- 
munication with  the  exterior.  What  is  still  more  notable  is 
that  these  rivers  flow  with  an  almost  constant  current  over 
level  beds,  between  perpendicular  banks,  so  that  the  river- 
banks  form  a  series  of  natural  ports,  with  wharves  of  in- 
definite length.  Nature  has  well  prepared  the  way  for  the 
handiwork  of  man. 

The  hydrographic  system  of  the  Argentine  Republic  falls 
into  three  main  groups  :  (1)  the  rivers  tributary  to  the  basin 
of  the  Rio  de  la  Plata ;  (2)  the  rivers  which  terminate  their 
course  in  lakes  or  pools,  or  lose  themselves  in  forming 
marshes  or  salt  swamps,  and  are  finally  absorbed  by  the 
porous  soil  of  the  Pampa ;  (3)  the  rivers  which  empty  them- 
selves into  the  ocean. 

To  the  first  group  belong  all  the  rivers  which  water  the 
Provinces  of  Corrientes,  Entre  Rios,  Chaco,  Jujuy,  and  Salta, 
a  portion  of  those  of  Santa  Fe,  Cdrdoba,  and  Buenos  Ayres, 
and  the  Territories  of  Chaco  and  Misiones.  To  the  second  jj 
group  belong  all  the  water-courses  of  the  Provinces  of 
Tucuman,  Catamarca,  Santiago  de  I'Estero,  La  Rioja,  San 
Juan,  Mendoza,  San  Luis,  the  greater  part  of  those  of 
C6rdoba,  and  part  of  those  of  Buenos  Ayres.     To  the  third 

*  Perhaps  it  need  hardly  be  explained  that  the  meaning  of  this  statement  is 
that  the  rent  of  agricultural  land  reaches  its  par  value  when  it  is  absolutely 
accessible — say,  beside  a  port.  With  high  ocean  freights  and  low  railway 
freights  any  land  upon  a  railroad  would  be  almost  equally  accessible  economic- 
ally— that  is,  it  would  reach  almost  its  whole  value. — [Teans.J 


THE  GEOGRAPHY  OF  THE  ARGENTINE        79 

group  belong  also  a  portion  of  the  rivers  of  Buenos  Ayres, 
and  all  the  rivei'S  of  Patagonia.  As  we  have  seen,  the  water- 
ways of  the  Province  of  Buenos  Ayres  come  under  all  three 
headings. 

The  best-known  river  of  the  Republic,  and  that  which  .^ 
gives  the  Argentine  its  name,  is  the  Rio  de  la  Plata,  formed 
by  the  junction  of  two  rivers  no  less  important,  the  Parana 
and  the  Uruguay.  It  forms  an  immense  estuary,  which  pours 
into  the  ocean  the  waters  of  a  whole  hydrographic  system,  a 
vast  basin  occupying  nearly  1,540,000  square  miles,  or  a  fourth 
part  of  South  America.  This  estuary  is  25  miles  wide  at  its 
head,  and  where  its  waters  reach  the  ocean  attains  a  width 
of  no  less  than  217  miles,  its  average  width  being  111  miles; 
and  its  superficial  area  covers  13,475  square  miles. 

Apart  from  certain  hindrances  of  the  nature  of  islands  or  \ 
sandbanks,  the  Rio  de  la  Plata  offers  relatively  easy  access  to 
vessels  of  the  highest  tonnage  making  for  Buenos  Ayres  or 
towards  the  interior.  Its  level  is  influenced  by  the  tides  of 
the  ocean,  and  also  suffers  very  violent  changes  when  the 
easterly  or  south-easterly  winds  pile  up  the  waters  ot  the  sea 
in  the  estuary.  ^ 

The  river  which  is  the  continuation  of  the  Rio  de  la  Plata 
towards  the  north,  and  with  it  forms  the  vital  artery  of  the 
Argentine,  is  the  Parana ;  its  length  is  2980  miles,  of  which 
about  one  -  half  flows  through  Argentine  territory.  Its 
width  varies  from  22  to  31  miles,  and  its  average  annual  flow 
is  estimated  at  nearly  39,000  cubic  yards  per  second,  which 
represents  one  and  a  half  times  that  of  the  Mississippi,  twice 
that  of  the  Ganges,  four  times  that  of  the  Danube,  five  times 
that  of  the  Nile,  and  nearly  a  hundred  times  that  of  the 
Seine.  It  receives,  in  its  turn,  as  an  affluent,  the  Paraguay, 
a  river  which  traverses  the  country  of  the  same  name,  and 
thus  places  it  in  communication  with  the  sea,  by  way  of  the 
Parana  and  the  Rio  de  la  Plata, 

This  network  of  rivers  forms  a  magnificent  series  of  water- 
ways. Rising  from  the  central  provinces  of  Brazil,  the 
Parana  passes  through  the  rich  afforested  regions  of  Chaco, 
communicates  by  means  of  its  affluent  with  Paraguay  and 
South  Brazil,  and  then  flows  through  the  Provinces  of 
Corrientes,  Entre  Rios,  and  Santa  Fe ;  that  is,  through  the 


80      THE  ARGENTINE  IN  THE  20th  CENTURY 

regions  of  great  forests  and  wide  holdings,  and  then  empties 
itself  into  the  inland  sea  of  the  Rio  de  la  Plata,  where  it 
mingles  with  the  Uruguay,  another  means  of  communication 
between  the  Provinces  of  the  East  and  the  Atlantic  Ocean.      ' 

Concerning  its  navigability,  here  are  some  data  taken 
from  an  interesting  little  book  by  M.  Georges  Hersent  on  the 
port  of  Rosario : — 

"  During  nine  months  of  the  year  the  navigation  from  the 
sea  to  the  port  of  Rosario  presents  no  difficulties  to  the  great 
transatlantic  steamers;  indeed,  it  may  be  said  that  their 
maximum  draught  is  limited  only  by  the  depth  of  the 
'  Canal  Nuevo,'  the  new  channel  of  Martin  Garcia.  Ships 
drawing  22  to  23  feet  can  load  at  Rosario  and  leave  directly 
for  the  open  sea,  or  come  to  discharge  their  cargo  at  the  port. 

"  During  the  period  of  low  water,  which  lasts  for  barely 
three  months  in  the  year — from  September  to  the  end  of 
December — there  are  only  two  channels  with  a  less  depth 
than  21  feet,  that  of  Las  Hermanas  and  that  of  Paraguayo. 
In  the  former,  the  island  of  Las  Hermanas  separates  the  bed 
of  the  river  into  two  channels,  of  which  the  one  most  in 
general  use  hitherto  has  a  depth  of  only  20  feet ;  but  vessels 
may  avoid  it  to-day,  as  the  western  channel  has  been  dredged 
and  deepened,  and  is  of  more  than  sufficient  depth. 

"  The  second  channel,  which  used  to  present  some  difficulty, 
is  that  of  the  Paraguayo,  where  there  was  only  17  feet  of 
water.  This  state  of  things  was  happily  not  permanent,  as 
the  National  Government  has  undertaken,  at  this  spot,  the 
work  of  deepening  and  levelling  the  Parana,  which  was 
completed  in  the  course  of  the  year  1904. 

"  We  may  add  that  the  State  is  engaged  in  maintaining, 
over  a  minimum  width  of  108  yards,  a  depth  of  19  feet  below 
the  level  of  low  water  in  the  channel  of  Martin  Garcia,  and 
of  21  feet  1|  inches  over  the  whole  course  of  the  Parana,  as 
far  as  Rosario.  This  maintenance  will  be  necessary  only  at 
certain  points  in  the  river,  as  the  depth  of  the  latter  is  in 
general  considerably  above  those  figures." 

As  we  have  already  said,  the  real  commercial  value  of 

the  Parana  lies  in  the  peculiarity  of  its  banks,  which  make 

it  along  its  whole  course  a  series  of  natural  quays.     These 

{  banks  form  in  many  places  almost  vertical  walls,  and  as  the 


THE  GEOGRAPHY  OF  THE  ARGENTINE   81 

bed  of  the  river  is  almost  everj'^where  25  feet  below  the 
surface,  it  follows  that  ships  of  large  tonnage  can  not  only 
ascend  the  river  as  far  as  the  city  of  Rosario,  or  even  to 
Colastine,  but  can  moor  themselves  alongside  the  banks  as  to 
a  quay,  without  any  labour  or  preparation  being  necessary. 

At  some  places — as  at  Rosario  for  example — the  bank 
properly  so-called  is  overhung  by  low  cliffs,  forming  a  kind 
of  promontory  raised  many  feet  above  the  water-level,  so 
that  it  is  possible  to  utilise  this  difference  of  level  in  loading 
cargoes.  By  means  of  inclined  planes  or  gangways,  called 
canaletas,  the  goods  collected  in  warehouses  built  upon  the 
banks  are  quickly,  thanks  to  the  slope  of  the  gangways,  run 
into  the  holds  of  the  vessels  moored  to  the  banks.  It  will 
be  admitted  that  these  conditions  are  unusually  favourable 
to  navigation,  and  explain  the  extraordinary  development  of 
a  country  in  which  nature  has  thus  surpassed  herself. 

Regarded  as  traffic-ways,  these  rivers  play  a  part  of  the  \^ 
highest  importance,  by  giving  easy  access  to  the  sea,  \^ 
without  re-shipment,  to  provinces  more  than  600  miles  inland,  y. 
such  as  those,  for  instance,  of  Chaco  and  Corrientes, 

The  Rio  de  la  Plata  affords  a  natural  traffic- way,  accessible 
to  all  vessels,  between  Buenos  Ayres  and  Montevideo,  which 
are  more  than  120  miles  apart.  All  the  large  transatlantic 
steamers  which  used  some  time  ago  to  put  in  at  La  Plata 
now  come  up  to  Buenos  Ayres,  which  has  thus  become  the 
headquarters  of  a  dozen  wealthy  steamer-lines  engaged  in 
the  European  service. 

Thanks  to  the  works  established  for  the  deepening  of  the 
Parana  and  the  regularising  of  its  course  through  the  sandy 
districts,  great  steamers  of  10,000  tons  can  to-day  go  up  to 
Rosario :  steamers  of  6000  tons  can  easily  reach  Parana  or 
Colastine ;  and  special  boats  built  for  the  river  service  can 
ascend  a.3  far  as  Corrientes,  and  from  there  towards  Brazil, 
Paraguay,  or  Uruguay  :  a  distance  of  more  than  1200  miles. 

Besides  these  "flowing  roads,"  we  must  mention  others, 
which,  although  of  less  importance,  are  none  the  less  destined 
to  exercise  a  beneficent  influence  over  the  economic  life  of 
the  premier  province,  and  the  development  of  its  agriculture, 
thanks  to  the  cheap  transit  which  they  will  offer  in  time 
to  come.      We  refer   to   the   network  of   canals  which  the 


82      THE  ARGENTINE  IN  THE  20th  CENTURY 

Government  of  the  Province  of  Buenos  Ayres  has  projected  or 
put  in  hand. 

In  the  first  edition  of  this  book  we  announced  the  con- 
struction of  a  canal  155  miles  in  length,  which  would  unite 
the  Mar  Chiquita,  its  point  of  origin,  and  Baradero,  its 
terminus ;  embracing  in  its  course  the  following  centres  of 
rural  produce  ;  Laf  orcade,  Junin,  O'Higgins,  Chacabuco,  Salto, 
Arrecifes,  and  Baradero.  This  enterprise,  which  was  put  in 
hand  at  the  expense  of  the  Province  of  Buenos  Ayres,  failed 
with  a  crash.  After  the  work  had  been  enthusiastically 
commenced,  after  several  millions  of  dollars  had  already  been 
spent,  it  was  discovered  that  the  work  could  never  be 
completed  in  a  successful  manner,  nor  could  it  ever  yield  a 
return  for  the  sums  raised,  which  were  thus  swallowed  up  in 
this  disastrous  enterprise. 

Men  whose  technical  competence  allowed  them  to  speak 
with  authority — for  instance,  the  engineer,  Luis  A.  Huergo — 
basing  their  statements  on  scientific  principles,  had  estimated 
that  the  undertaking  could  never  be  practically  realised ; 
and,  as  we  have  seen,  the  result  justified  their  predictions. 

Ports  and  Harbours 

The  nature  of  the  river-banks  being  such  as  we  have 
described,  the  ports  utilised  by  trade  along  the  course  of  the 
great  Argentine  rivers  are  very  numerous. 

After  La  Plata  and  Buenos  Ayres,  which  share  the  traffic 
of  the  northern  part  of  the  Province  of  Buenos  Ayres,  we 
must  mention  Campana  and  Zarate,  for  at  these  two  ports 
also  the  exports  of  frozen  meat  are  very  considerable ;  San 
Nicolas,  a  great  centre  for  cereals,  whose  harbour  is  to  be 
transformed  and  equipped  by  the  new  concessionnaire,  the 
"  Soci^te  Anonyme  du  Port  et  Entrepot  de  San  Nicolas  " ;  and 
Villa  Constitucidn,  whence  the  produce  of  the  south  of  Santa 
Fe  and  C6rdoba  is  exported,  and  whose  capacity  is  7000  to 
8000  sacks  a  day. 

After  Rosario,  which  is  the  second  centre  of  the  Republic, 
the  chief  ports  ascending  the  Parana  are  as  follows :  San 
Lorenzo,  Diamante,  Santa  Fe,  Colastin^  Parana,  Esquina, 
Goya,  Bella  Vista,  and  Empedrado,  Corrient^s  is  the  last 
important  commercial  centre  on  the  banks  of  the  Parana. 


THE  GEOGRAPHY  OF  THE  ARGENTINE 


88 


All  these  ports  had  an  annual  tonnage  amountinor  to 
2,188,000  tons  in  1906,  2,366,000  in  1907,  and  5,396,000  in 
1908,  so  that  the  statistics  for  these  three  years  of  the  traffic 
for  the  Parana,  including  Rosario,  amounts  in  round  figures 
to  9,891,000  tons,  for  the  distance  of  80-i  miles. 

At  Santa  Fe  work  has  been  commenced  on  the  installa- 
tion of  a  more  modern  harbour ;  the  Province,  by  consent 
of  the  State,  has  devoted  a  sum  of  £6,000,000  to  this  under- 
taking. There  has  also  at  times  been  a  question  of  equipping 
the  port  of  Colastine,  which  is  one  of  the  principal  centres 
of  export  for  cereals  and  the  timber  brought  by  the  French 
railway  system  of  Santa  F^.  The  average  trade  passing 
through  this  port  amounts  to  more  than  500,000  tons,  and, 
so  far,  there  has  been  no  need  to  add  any  improvements  to 
the  natural  advantages  of  the  river-banks.  We  see  by  this 
that  there  is  no  need  to  create  ports  on  the  Parana,  only  to 
utilise  or  develop  existing  conditions. 

"We  give  below  a  table  of  the  trade  statistics  of  the 
principal  ports  of  the  Argentine  Republic,  remembering  that 
with  the  exception  of  Buenos  Ay  res  their  trade  consists 
largely  of  the  exports  of  produce : — 

Traffic  in  Registered  Tons  at  the  following  ports  in  the 
years  1907  an(?1908. 

Rio  Gallegos* 

Madryn*  

Commodore  RivadaA'ia* 

Ushuaia* 

Diamante 

Santa  Fe  

Parana 

Esquina  

Goya     

Bella  Vista      

Empedrado      

Corrient^s        

Rosario 
Buenos  Ayres  ... 

The  premier  port  of  the  Argentine,  and  we  might  add 
of  South  America,  is  Buenos  Ayres,  which  in  extent  and 
connections  rivals  the  finest  ports  of  Europe. 

*The  tonnage  of  these  ports  is  for  the  years  1904  and  190G,  no  correspond- 
ing figures  being  obtainable  for  1907  and  1908. 


1907 

1908 

63,500 

41.000 

118,000 

19,900 

59,000 

1,990 

25,000 

11,800 

131,000 

375,000 

127,000 

440,000 

253,000 

636,000 

117,000 

374,000 

163,000 

404,000 

136,000 

399,000 

116,000 

.306,136 

230,000 

504,433 

1,089,000 

1,924,000 

6,471,000 

7,555,000 

84      THE  ARGENTINE  IN  THE  20th  CENTURY 

It  consists  of  two  harbours,  of  which  one,  situated  at 
the  mouth  of  a  little  river  called  Riachelo,  is  frequented 
principally  by  steamers  of  light  draught  and  sailing-ships ; 
the  other  is  known  as  the  Port  of  the  Capital,  or  more 
commonly  Port  Madero,  from  the  name  of  the  contractor 
responsible  for  the  harbour  works.  The  port  contains,  alto- 
gether, four  basins  and  6^  miles  of  quays,  four  of  which  are 
situated  on  the  flank  of  the  city.  Along  these  quays 
are  disposed  immense  warehouses,  able  to  contain  29 
millions  of  tons  of  merchandise,  as  well  as  great  flour- 
mills  and  grain-elevators,  with  a  capacity  of  more 
than  200,000  tons,  which  cost  more  than  £1,000,000 
sterling.* 

This  harbour  has  cost  in  all  some  £7,000,000,  and  every 
year  a  sum  of  nearly  3  millions  of  paper  piastres,  or 
£200,000,  is  spent  upon  the  work  of  maintaining  the  channel 
of  approach  at  a  proper  depth.  At  the  season  when  the 
traffic  is  densest,  the  port  holds  as  many  as  1400  steamers 
and  sailing-vessels,  loading  and  unloading.  It  is  evident 
that,  with  the  constant  increase  of  commercial  activity, 
further  enlargements  will  soon  be  necessary.  The  Govern- 
ment is  at  the  present  moment  considering  a  gigantic 
scheme  of  improvement,  with  a  view  to  which  several 
groups  of  European  contractors  have  already  submitted 
estimates. 

In  order  to  give  some  idea  of  the  importance  of  the  plant 
at  the  disposal  of  exporters  at  Buenos  Ayres,  we  need  only 
speak  of  the  great  market  or  embarcardero  for  live-stock. 
It  covers  an  area  of  350,000  square  yards,  of  which  117,000 
are  occupied  by  buildings ;  its  capacity  is  40,000  sheep  and 
more  than  1500  cattle. 

There  is  also  another  notable  establishment,  reputed  to 
be  the  largest  in  the  world:  the  Central- Produce  Market. 
The  building  is  of  four  stories,  covers  an  area  of  180,000 
square  yards,  and  cost  £830,000. 

The  following  table  shows  the  quantities,  in  metric  tons, 

♦  The  net  capacity  of  the  customs  warehouBes  is  over  400,000  tons  ;  as 
products  remain  there  on  an  average  for  two  months,  we  have  an  annual  figure 
of  6x400,000  =  2,400,000  tons.  This  is  the  maximum  of  goods  per  annum 
which  the  customs  depots  can  at  present  receive. 


THE  GEOGRAPHY  OF  THE  ARGENTINE        85 


of   products    entering   the    market    between    February    and 
September  in  1905,  190G,  1907  and  1908. 


Tons  of 

2205  lbs. 

190S 

1906 

1907 

.908 

Maize 

721 

fi,882 

9,600 

10,742 

Wheat 

34,24« 

50,379 

73,LM5 

47,a(;G 

Flax 

1,115 

3,G36 

5,584 

10,757 

Barley 

83 

368 

1,361 

1,695 

Oats 

LG88 

3,624 

6,685 

15,737 

Hides  and  skins 

17,713 

18,541 

17,115 

22,371 

Other  products 

1,786 

1,838 

1,804 

2,165 

Besides  these  products,  in  1906  there  were  87,400  tons  of 
wool  entered  at  the  market;  in  1907,  84,600  tons  ;  and  during 
the  first  nine  months  of  1908,  nearly  43,000  tons.  If  the 
year  1908  seems  to  show  a  great  decrease  in  the  entry  of 
wools,  the  fact  is  really  due  to  the  larger  amounts  entered 
in  October,  November,  and  December,  which  are  not  included 
in  the  figures  for  1908. 

These  figures  show  the  importance  of  this  establishment 
to  Argentine  trade.  It  is  not  a  mere  dep6t,  as  one  might 
suppose,  but  a  veritable  Exchange,  where  important  trans- 
actions take  place  in  all  the  chief  products  of  the  country. 

The  port  of  Buenos  Ayres  owes  its  rapid  development  to 
this  excellent  equipment.  In  1880,  before  the  scheme  of 
works  was  commenced,  its  trade  amounted  scarcely  to 
660,000  tons ;  since  then  it  has  maintained  a  constant 
increase,  and  now  reaches  the  figure  of  more  than  13,000,000 
tons. 

Below  is  the  inward  and  outward  trade  of  the  port  of 
Buenos  Ayres : — 

Tonnage. 
...   7,365,000 

8,115,000 
...  8,742,000 
...  8,047,000 
...  8,(361,000 
...  8,903.000 
...  10,269,000 


Years. 
1897 
1898 
1899 
1900 
1901 
1902 
1903 
1904 
1905 
1906 
1907 
1908 


10,400,000 
11,589,000 
12,582,000 
13,295,000 
15,111,000 


To  appreciate  the  value  of  these  figures,  we  must  compare 


86      THE  ARGENTINE  IN  THE  20th  CENTURY 

them  with  those  relating  to  the  principal  ports  of  the  world, 
where  we  shall  see  that  Buenos  Ayres  occupies,  in  matters 
of  tonnage,  the  twelfth  place  among  the  ports  of  the  world. 
The  tonnage  of  Hamburg  and  Liverpool,  which  occupy  the 
first  two  places,  is  only  about  40  per  cent,  greater  than  that 
of  Buenos  Ayres. 

The  importance  of  the  port  of  Buenos  Ayres  is  chiefly 
due  to  the  fact  that  it  handles  nearly  all  the  imports  of  the 
Republic — 84  per  cent,  in  1908 — while  of  exports  it  handles 
51  per  cent.  This  confirms  what  we  have  already  said  of 
the  absorption,  by  Buenos  Ayres,  of  a  great  portion  of  the 
vital  forces  of  the  country,  which  develops  it  disproportion- 
ately to  the  rest  of  the  country.  The  equipment  of  the  new 
ports  of  Rosario,  San  Nicolas,  and  Santa  Fe,  and  the  enlarge- 
ment of  the  port  of  Bahia  Blanca,  will  constitute  a  useful 
task  of  decentralisation,  favourable  to  the  economic  future 
of  the  country. 

La  Plata  has  the  advantage  over  Buenos  Ayres  of  a 
deeper  basin,  which  renders  its  harbour  accessible  at  all 
times  to  ships  of  the  highest  tonnage.  Until  1903  it  was 
the  point  of  call  for  the  large  transatlantic  liners  outward 
or  inward  bound,  which  observed  fixed  hours  of  arrival  and 
departure. 

The  harbour  of  La  Plata,  3  miles  from  the  town,  contains 
about  2700  yards  of  quays  and  immense  warehouses,  capable 
of  storing  600,000  sacks  of  grain.  It  is  the  terminus  of  the 
lines  of  railway  serving  the  richest  districts  of  the  Province 
of  Buenos  Ayres,  and  is  destined  to  undergo  further  develop- 
ments, as  the  provincial  Government  intends  to  connect  it 
with  the  agricultural  centres  by  a  network  of  light  railways. 
This  is  the  principal  port  to-day  for  the  exportation  of  the 
agricultural  products  of  the  central  Pampa. 

On  account  of  the  economic  importance  of  this  port,  the 
State  has  taken  it  over  from  the  provincial  Government, 
in  consideration  of  a  price  of  £2,360,000,  with  a  view  to 
nationalising  it  and  exploiting  it  for  the  benefit  of  the 
Argentine  State.  This  measure  will  allow  of  the  organisa- 
tion and  the  improvements  which  may  be  necessitated  by 
the  increase  of  its  trafl^ic.  On  the  other  hand,  there  is 
constant  talk  of  connecting  the  port  with  that  of  Buenos 


THE  GEOGRAPHY  OF  THE  ARGENTINE        87 

Ayres  by  a  canal  some  29  miles  long,  which  would  form  an 
artificial  extension  of  both  liarbours. 

Rosario  holds  second  place  in  the  Argentine,  both  in  the 
matter  of  population  and  in  the  extent  of  its  trade.  It  is 
the  true  agricultural  capital  of  the  Republic,  and  the  principal 
outlet  of  eight  Provinces,  which  use  the  Parana  as  their 
waterway.  In  his  little  book  on  the  port  of  Rosario,  M.  G. 
Hersent  speaks  of  the  advantages  of  its  situation  in  the 
following  terms  : — 

"  Situated  in  the  very  centre  of  an  immense  tract  of 
country  which  is  extremely  rich  and  fertile,  which  to-day 
furnishes  more  than  half  the  cereals  exported  by  the  whole 
Republic,  Rosario  is  the  necessary  outlet  of  the  harvests  of 
nearly  the  whole  Province  of  Santa  F^,  of  the  whole  of 
Cordoba,  and  of  a  portion  of  Entre  Rios ;  three  provinces, 
whose  area  is  almost  equal  to  that  of  France.  It  is  the 
market  for  the  sugars  and  alcohols  of  Tucuman,  the  timber 
of  Catamarca,  and  the  minerals  of  Rioja  and  Chaco,  which  are 
80  far  exploited  only  in  a  rudimentary  fashion. 

"  In  order  to  fulfil  this  economic  need  of  vital  importance 
to  the  country,  Rosario  enjoys  the  most  complete  and 
eflBcacious  means  of  access  and  penetration.  Five  great 
railroads  converge  upon  it,  bringing  to  it  all  the  products 
of  the  interior,  especially  grain  and  cattle.  This  network  of 
lines,  whose  rapid  creation  has  been  one  of  the  most  power- 
ful factors  of  the  development  of  Rosario,  already  contains 
more  than  2700  miles  of  permanent  way  ;  in  1899  the  traffic 
in  the  Rosario  district  already  amounted  to  3,400,000  tons 
of  merchandise,  consisting  chiefly  of  the  produce  of  the  soil. 
The  extension  of  this  railway  system  is  proceeded  with  in  a 
more  or  less  continuous  manner,  so  as  to  increase  the  value 
and  the  opening  up  of  new  countries.  Very  shortly  the  line 
to  Bolivia  will  have  its  terminus  in  Rosario. 

"  But  that  which  gives  this  port,  so  well  equipped,  an  in- 
comparable value,  is  the  magnificent  Parana,  which,  on  the  one 
hand,  places  it  in  direct  communication  with  the  sea,  and  on 
the  other  unites  it  with  the  interior  by  a  waterway  of  several 
thousand  miles  in  length,  constituting  a  means  of  transport 
as  easy  as  it  is  economical,  which  brings  it  all  the  water- 
borne  traffic  of  the  upper  Parana  and  of  the  Paraguay." 


88      THE  ARGENTINE  IN  THE  20th  CENTURY 

The  statistics  given  above  show  the  important  place 
which  this  port  has  taken  in  the  last  few  years,  and  the 
continued  increase  of  its  traffic,  which  to-day  amounts  to 
some  3,000,000  tons  per  annum,  whereas  in  1899  it  amounted 
only  to  1,600,000  tons. 

Hitherto  these  results  have  been  obtained  with  a  rudi- 
mentary equipment,  and  by  utilising  the  fortunate  disposi- 
tion of  the  river-banks;  but  the  intense  pressure  of  traffic 
occurring  at  this  point  proves  the  necessity  of  a  large 
harbour,  which  would  allow  the  products  of  the  interior  to 
find  their  outlet  towards  the  Parana  and  the  sea.  The  need 
has  given  birth  to  the  means  without  waiting  for  modern 
improvements. 

To-day  the  port  of  Rosario  has  entered  upon  a  new 
phase,  which  may  clear  the  way  for  a  still  greater  develop- 
ment. Its  exploitation  has  been  made  the  object  of  a  con- 
cession which,  in  1902,  was  granted  to  a  French  company, 
having  at  its  head  Messieurs  Hersent  &  Son  and  the  Creusot 
works,  on  condition  that  the  latter  should  undertake  the 
equipment  of  the  port  on  modern  lines.  The  scheme  com- 
prises, among  other  items,  the  construction  of  over  2  miles  of 
quays  and  a  dock  which  will,  with  the  existing  quays,  give 
a  total  of  2f  miles ;  the  construction  of  warehouses,  the 
mechanical  equipment  of  the  quays,  and  also  the  installation 
of  a  grain-elevator  of  large  capacity,  which  will  load  a  cargo 
of  5000  cubic  yards  in  four  hours. 

To-day  this  scheme  is  nearly  realised,  and  Rosario  will  be 
able  to  meet  all  the  requirements  of  a  perpetually  increasing 
trade.  The  new  railway  lines,  which  will  soon  reach  the  port, 
will  complete  its  organisation. 

As  recompense,  the  Government  has  granted  the  con- 
cessionnaires,  for  forty  years,  the  monopoly  of  gathering  all 
harbour  dues  over  a  radius  of  7"4  miles  around  the  city  of 
Rosario,  and  over  a  distance  of  12  "4  miles  up-stream  and 
down-stream.  The  State  shares  in  the  takings  of  the  con- 
cession to  the  extent  of  50  per  cent,  of  the  net  profits  after 
the  expenses  of  exploitation  are  deducted,  which  are  estimated 
at  40  per  cent,  of  the  receipts,  and  after  the  subtraction  of 
the  sums  necessary  for  pajdng  the  interest  on  and  redeeming 
the  capital  engaged. 


THE  GEOGRAPHY  OF  THE  ARGENTINE   89 

From  all  these  data  concerning  the  ports  of  the  Parana, 
it  will  be  seen  that  great  eflorts  are  now  being  made  to 
increase  the  means  of  communication  in  proportion  to  the 
economic  expansion  of  the  country,  and  to  multiply  and 
facilitate  outlets  upon  the  points  nearest  to  the  centres  of 
production.  These  efforts  are  also  tending  to  decentralise 
the  traffic,  to  the  profit  of  a  larger  number  of  ports:  in  order 
to  avoid  the  over-crowding  of  a  few  great  centres  to  the 
detriment  of  other  parts  of  the  country.  This  policy  will 
have  happy  results  :  firstly,  from  the  point  of  view  of  the 
export  trade,  since  it  will  decrease  the  net  cost  of  transport ; 
and  secondly,  from  the  standpoint  of  the  import  trade,  as  the 
imports,  instead  of  converging  upon  Buenos  Ayres  and 
thence  proceeding  by  rail,  will  reach  the  neighbourhood  of 
the  inland  centres  of  consumption  more  directly  and  at  less 
expense. 

For  these  same  reasons  serious  improvements  have  been 
carried  out  at  the  port  of  Bahia  Blanca,  which  is  situated  on 
the  sea-coast  in  the  south  of  the  Province  of  Buenos  Ayres, 
whose  importance  has  increased  more  especially  since  the 
opening  of  the  military  harbour  to  commerce.  Bahia  Blanca 
is  one  of  the  termini  of  many  railways  of  the  south ;  it  is 
thus  connected  with  the  regions  of  agriculture  and  stock- 
raising  on  a  large  scale,  which  are  able  to  send  their  produce 
directly  from  this  port  to  Europe.  The  wool  trade  is  particu- 
larly brisk  there,  and  the  cereal  trade  also,  since  the  Pampa 
has  been  transformed  into  a  wonderful  agricultural  country. 

Seconding  this  development,  already  stimulated  by  the 
Southern  Railway  Company,  which  built  the  harbour  known 
as  "  Ingenio  White,"  the  Buenos  Ayres  and  Pacific  Railway 
Company  has  also  commenced  at  Bahia  Blanca  a  magnificent 
harbour,  called  Galvan  Harbour.  Built  of  reinforced  cement, 
it  is  equipped  with  powerful  grain-elevators,  built  of  stone, 
splendid  iron  warehouses,  sheds,  etc.  This  harbour,  when 
completed,  will  have  cost  some  £10,000,000;  it  has  already 
a  considerable  trade,  which  will  increase  in  proportion  to  the 
agricultural  development  of  the  great  belt  it  is  intended  to 
serve,  which  includes  the  Provinces  of  San  Juan,  San  Luis, 
Mendoza,  the  Territory  of  the  Central  Pampa,  and  a  large 
part  of  the  Province  of  Buenos  Ayres.     The  importance  of 


90      THE  ARGENTINE  IN  THE  20th  CENTURY 

this  harbour  will  also  be  increased  by  the  various  railways 
which  will  unite  Bahia  Blanca  to  the  remote  districts  of  the 
Republic.  The  French  company,  now  building  a  line  running 
between  Rosario  and  Bahia  Blanca,  will  also  have  its  own 
harbour,  the  Puerto  Belgrano,  and  is  actively  carrying  on  its 
construction. 

Finally,  the  creation  of  a  harbour  has  been  projected  at 
Mar  del  Plata,  the  fashionable  watering-place  of  the  Argen- 
tine, and  another  in  the  Bay  of  Samborombon,  two  hours 
from  Buenos  Ayres. 

To  sum  up :  the  Argentine  possesses  at  the  present  time, 
in  the  matter  of  ports,  an  equipment  capable  of  keeping  pace 
with  the  growth  of  its  powers  of  production.  Its  rivers 
are  truly  arms  of  the  sea,  collecting  on  their  banks,  thanks 
to  their  numerous  ports,  the  products  of  the  central  Pro- 
vinces, which  are  thus  connected  with  the  Atlantic  over  a 
distance  of  more  than  600  miles.  It  is  the  same  on  the 
Atlantic  sea-board,  where  advantage  has  been  taken  of  the 
least  natural  facilities  afforded  by  the  coast-line  to  multiply 
the  outlet  to  exportation,  in  proportion  as  the  progress  of 
agriculture  has  travelled  south.* 

It  is  true  that  this  great  organisation  can  only  yield  the 
true  measure  of  its  value  in  years  of  good  harvests,  since 
upon  the  latter  all  commercial  activity  depends ;  yet  it  must 
be  recognised  that,  however  largely  the  future  has  been  dis- 
counted in  equipping  these  ports,  the  estimates  of  future 
traffic  have  scarcely  ever  hitherto  been  deceptive. 

*  Among  the  principal  ports  of  the  south  we  may  cite  Madryn,  Rio  Gallego, 
Commodoro  Rivadavia,  and  Ushuaia,  in  Tierra  del  Fuego.  These  ports,  by  a 
wise  disposition  of  the  Government,  seeking  to  increase  the  population  and 
encourage  progress  in  the  southern  regions  of  the  Republic,  have  been  made  free 
ports ;  that  is  all  the  operations  of  the  douane  may  be  effected  without  the 
payment  of  fiscal  dues. 


CHAPTER  II 

RAILWAYS 

Rapid  development  of  the  railway  system — Tabulation  of  its  extension  in  each 
Province — Table  showing  the  general  results  of  its  exploitation — List  of 
the  lines  actually  running. 

List  of  railway  companies,  with  the  length  of  their  roadways  and  their  returns — 
The  diflBculty  of  obtaining  exact  figures — The  tariffs  of  the  railway 
companies — Form  of  concessions,  and  suppression  of  guarantees. 

Comparison  of  the  railway  system  of  the  Argentine  with  the  railway  systems  of 
other  countries — Proportion  of  mileage  to  area  and  population. 

Extension  of  the  system  in  the  near  future,  owing  to  the  numerous  concessions 
granted — The  mileage  of  these  concessions — Insufficiency  of  plans  and 
previous  examinations — Examination  of  the  most  important  concossione  for 
which  the  capital  is  already  guaranteed — The  dimensions  which  the  railway 
system  will  attain  after  the  concessions  are  realised — Programme  of  narrow- 
gauge  construction ;  its  value. 

Meeting  of  the  Argentine  with  the  Chilian  railways  crossing  the  range  of  the 
Andes — The  aerial  mining  railway  in  the  Province  of  La  Rioja. 

Railways  in  relation  to  agricultural  development — Insufficiency  of  transport  at 
the  moment  of  harvest ;  its  causes  and  remedies — Necessity  of  a  better 
organisation  which  shall  respond  to  the  stress  of  production. 

THE  same  progressive  spirit  which  the  Argentine  has 
manifested  in  the  improvement  of  inland  or  maritime 
waterways  is  to  be  seen  in  the  establishment  of  its  network 
of  railways.  Here  again  development  has  been  rapid,  and 
results  plainly  effectual  in  making  the  wealth  of  the  country 
available.  To  cite  one  example  only,  it  is  thanks  to  the 
railways  that  agriculture  and  stock-raising  have  been  able 
to  attain  to  such  large  dimensions  in  the  Province  of  Buenos 
Ay  res;  a  Province  far  less  favoured  than  its  northern 
neighbours  in  the  matter  of  waterways.  All  the  lines 
running  south  havegreatly^  contributed  to  the  transforma- 
tion  of  the  Pampa  and  the  increase  of  the  cultivated  area 
over  an  "immense"  radius  where  before  there  was  nothing  but 
untilled  soil,  which  w^as  hardly  suited_  even  for  stock - 
raising. 

The  railway  has  thus  played  a  great  part  in  civilising 
91 


92      THE  ARGENTINE  IN  THE  20th  CENTURY 

the  Argentine:  raising  new  wealth  from  eoil  as  yet  un- 
exploited,  joining  up  the  chief  agricultural  centres,  and 
affording  them  an  outlet  to  the  rivers  or  the  sea.  The  rail- 
way has  also  been  auxiliary  to  the  colonising  movement, 
sXtmulattng  the  creation  of  new  settlements  along  its  track 
by  "concessions  of  soil. 

This  latter  work  is  not  yet  terminated,  if  we  are  to  judge 
by  the  great  number  of  concessions  now  under  consideration, 
in  which  the  initiative  is  due  to  the  State  or  to  private 
individuals.  On  the  other  hand,  there  is  a  great  tendency 
to  build  cheap  narrow-gauge  railways,  in  order  to  save 
expense  either  in  building  or  in  working,  so  as  to  obtain 
a  final  reduction  of  the  freight  tariff.  In  short,  we  find, 
in  the  case  of  railways  as  well  as  in  the  case  of  waterways, 
that  Mobile  the  continuation  of  good  harvests  is  counted 
on,  there  is  also  an  effort  to  keep  up,  by  multiplying  the 
means  of  transport,  with  the  economic  expansion  of  the 
country. 

It  was  in_J.854  that  the  Government  of  the  Province  of 
Buenos  Ayres^ granted  the  first  railway  concession,  foF  sTTTne 
24,000  varea*  in  length,  running  west  from  Buenos  Ayres. 
In  1857  a  first  section,  some  6  miles  long,  was  opened  for 
traffic. 

After  these  humble  beginnings  the  railway  system  of 
the  Argentine  developed  with  great  rapidity ;  on  the  1st  of 
November  1908,  its  total  length  was  13,700  miles,  represent- 
ing an  average  development  of  nearly  273  miles  per  annum. 
All  the  Provinces  are  represented  in  these  figures,  but  of 
course  in  very  unequal  proportions ;  as  the  opportunities  of 
construction  have  not  been  everywhere  the  same.  Their 
installation  has  gone  hand  in  hand  with  agricultural  develop- 
ment ;  and  the  Provinces  most  adapted  to  agriculture  have 
also  been  favoured  with  tbe  most  plentiful  means  of  transit, 
as  the  following  table  will  show. 

^mong  these  Provinces  we  must  note  Buenos  Ayres, 
^^anCaT'e  and  CSrdoba  as  the  three  which  have  made  most  agri- 
cultural  progress ;  for  tliey  alone  furnish  more  than  80  per  cent. 

*  The  vine  is  equivalent  to  886  millimetres,  so  the  length  of  the  line  was 
about  13  miles.  At  that  period,  in  the  region  of  the  concession,  the  vare  of 
land  had  only  a  trifling  valne. 


RAILWAYS 


93 


of  tlie_  total  exports.     Among  the  Territories_L| 

£Ee  greatest  mileage  of  railways ;  a  mileage  which  will  very 

shortly  be  doubled,  to  judge  by  the  number  of  new  lines 

projected,  which  in  the  near  future  will  cross  it  in  every 

direction,   thus     facilitating    the     outlet    of    its    abundant 

produce. 

It  is  in  the  last  ten  years  that  the  network  of  Argentine 
railways  has  reached  its  full  expansion,  as  is  shown  by  the 
second  table  ;  which  also  gives  the  amounts  of  capital  invested 
in  these  undertakings. 


Mileage  of  Railway.^  on  the  \st  of  November  1908. 


Ratio  of  Mile.ige  to  Area. 


Provinces  and 
Territories. 

Mile.ige. 

In  kilometres 
per  loo 
sq.  kilometres. 

In  miles 
per loo 
sq.  miles. 

Miles  per 
looo  in- 
habitants. 

Province  of  Baenos  AyreB 

458.3-4 

2-42 

3-89 

3  06 

,,   Santa  Fe       

2254-1 

2-75 

4-42 

3-o:'. 

„       ,,  C<jrdoba        

1857-1 

1-86 

3  00 

3-66 

,,       ,,    Santiago  do  I'Estero 

810-9 

1-27 

2-04 

4^24 

,,  Entre  Rios 

610-5 

1-32 

2-12 

1-58 

Territory  of  Pampa  Centrale    ... 

556-9 

-61 

-98 

9-15 

Province  of  Corrient^s 

451-9 

•86 

1-38 

1-42 

„       „   Mendoza       

410-0 

•54 

•72 

2-25 

„       „  Tucumau      

384-3 

2-68 

4-31 

1-41 

,,       „   LaRioja        

319-2 

-57 

-92 

3^77 

,,       ,,  San  Luis 

303-8 

-66 

1-06 

2-97 

Territory  of  Rio  Negro 

239-4 

-20 

•32 

11-25 

Province  of  Salta 

228-0 

■23 

•37 

l-6:i 

,,       ,,  Catamarca    ... 

226-3 

•30 

-48 

215 

,,       ,,  Jujuy 

218-1 

•71 

1-14 

3-81 

Territory  of  Chaco          

97-2 

-11 

•17 

4-54 

Province  of  San  Juan      

85-7 

-16 

•26 

•81 

Federal  Capital 

55-3 

47-90 

77-12 

•05 

Territory  of  Chnbut        

43-5 

•03 

•05 

3-96 

,,         ,,  Neuquen      

2-6 

-004 

•006 

•10 

Total  and  Averages 


94       THE  ARGENTINE  IN  THE  20th  CENTURY 


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RAILWAYS  95 

The  number  of  railways  at  present  in  operation  ia  thirty, 
this  figure  including  the  railways  aud  cable  tramways 
or  mechanical  traction  lines  in  tlie  country  districts,  both 
public  and  private,  as  in  either  case  th^^y  servo  for  the 
transport  of  produce.  Of  these  tliirtj"  line's  t  wmty-sfvcn  are 
worked  by  private  companies  and  three  hy  the  State.  The 
latter  are  lines  of  no  great  valtir,  which  the  Government 
^s  itself  constructed,  or  which  it  has  had  to  take  over, 
eTEEef~Tn  the  general  interest  or  to  redeem  their  heavy 
guarantees. 

In  the  matter  of  comfort  the  great  Argentine  railways 
leave  nothing  to  be  desired,  and  many  Europeans,  out  of 
touch  [with  the  rapid  changes  of  this  progressive  country, 
would  certainly  be  much  astonished  to  learn  that  one  maj^ 
cross  the  Pampa  or  reach  the  foot-hills  of  the  Andes  in 
trains  equipped  with  sleeping-cars  and  restaurant-cars  of 
the  latest  type.  Perhaps  there  is  rather  less  orna- 
ment and  fewer  carpets  than  in  the  European  sleeping- 
cars,  but  the  same  cleanliness  will  be  found,  the  same 
service,  the  same  conveniences. 

The  rolling-stock  is  also  the  object  of  incessant  improve- 
ments. To  give  only  one  example,  the  Southern  Railways 
Company  has  placed  in  service  a  new  type  of  locomotive, 
with  two  pairs  of  double-expansion  cylinders.  These  engines 
have  ten  wheels,  of  which  six  are  coupled  and  four  mounted 
in  the  front  on  bogies  ;  their  maximum  power  enables  them 
to  draw  an  effective  load  of  2160  tons  up  an  incline  of 
1  in  500.  As  for  the  goods  wagons,  their  capacity 
is  40  tons  in  the  broad-gauge  lines  and  25  tons  on  the 
narrow  gauge. 

According  to  statistics,  on  the  1st  November  1908, 
the  various  railways  had  in  service  2992  locomo- 
tives, 2031  passenger-cars,  and  33,800  goods  wagons  or 
trucks. 

The  companies  are  enabled  to  import  free  of  tariff^  durin_g 
the  first  ten_and  sometimes  the  first  twenty  years  of  their 
faViff.  all  their  fixed  and  rolling  stock;  it  is  thus  to  their 
a3vantage  to  obtain  from  abroad  the  most  effective  equip- 
ment^m  pxder  to  'obtain  the  greatest  possible  profit  from 
the  governmental  favouj;. 


96      THE  ARGENTINE  IN  THE  20th  CENTURY 

The  table  given  below  contains  various  data  as  to  the 
various  concessions ;  it  gives  the  gauge  of  the  lines,  their 
mileage,  and  the  profits  of  the  principal  companies. 


Railways  and  Steam  Tramways  of  the  Argentine  Republic 
on  the  1st  of  January  1909. 


Railways  in  Operation. 

(Length  includes  branch  lines  but  not  auxiliary  He 
I.  State  Railways. 


or  loop  lines.) 


Andean 

Central  North 
Northern  Argentine 


Gauge. 

1-676  metres 
(5  ft.  6  in.) 


Mileage, 


interest  on 
Capital. 
299  5 -42% 

1066  -80 

470 


•46 


II.  Pkivate  Companies  (Conckssionnaires). 


Buenos  Ayres,  Southern 

Buenos  Ayres,  Western     ... 
Buenos  Ayres  and  Rosario 
Central  Argentine  ... 
Buenos  Ayres  and  Pacific  ... 
Argehtme,' Great  Western 
Bahia  Blanca  and  North-Western 
North-Eastern  Argentine 

Entre  Rios,  Central  

Buenos  Ayres,  Central 

Province  of  Santa  Fe  

Central  Cdrdoba  (Northern  Section) 
Central  C<5rdoba  (Eastern  Section) 

C6rdoba  and  Rosario  

North-Western  Argentine 

Ccjrdoba  and  North-Western 
Trans- Andean  Argentine  ... 
Chubut,  Central 


1-676  metres 

2574 

4-93 

(5  ft.  6  in.) 

,, 

1181 

5-93 

,, 

1202 

4-73 

,, 

1141 

8-31 

,, 

1013 

3-83 

., 

483 

4-40 

,. 

548 

2-46 

1-4S5  metres 

194 

1-19 

(4  ft.  S^in.) 

,, 

534 

2-50 

,j 

135 

3-33 

1-435  metres 

1054 

3-0 

(4  ft.  Si  in.) 

533 

2-62 

,, 

126 

7-37 

jj 

174 

3-01 

,, 

118 

4-32 

,, 

92 

•93 

,, 

105 

(loss)   -63 

" 

42 

5-95 

11,245 


RAILWAYS 


97 


Railways  of  thf  Second  Class,  Steam  Tramways,  Gable 
Lines,  etc. 


I.  For  Public  Service. 
Gauge. 


Steam  Tramway,  Rafaela  , 


,\      1  -435  met 
I  (4  ft.  8i  i. 


res 
in.) 


1  metre 
(3  ft.  3-4  in.) 
Malagueno  (connecting  with  the  Central 

x\.rgentino         

Municipal   Tramway   of   the    La   Plata 
Abattoirs 

Ocampo  Colony       1  metre 

(3  ft.  31-4  in.) 

Florencia  to  Piraeus  rO(J7  metres 

(3  ft.  6  in.) 
Railways  of  the  Entro  prin  de  Las  Cata-)      l-67(i  metres 

linas       /         (5  ft.  6  in.) 

Barranqneras  to  Reeistoncia         ...  ..  -75  metres 

(2  ft.  5-3  in.) 

Total, 


Mileage. 

53-40 


14  no 
2111 
12-42 
4  07 
lG-76 

122 -liG 


lnter«-5t  on 
Capital. 

•79% 


■36 


3-;!8 
O-40 


II.  Private. 


Tyrol  Harbour  to  Lucinda  Colony 

Steam   Tramway  from   Piraguacito    to"! 
Guillermina      ...         ...         ...  J 

Colony  of  Las  Palmas 

Valdez  Peninsula 


•6  metres 
(^3-6  in.) 
-75  metres 
(2  ft.  5-5  in.) 
-G  metres 
(23-6  in.) 
-76  metres 
(2  ft.  5-9  in.) 

Total, 


22-36 
53-40 
29-20 

19-87 


Summary. 

I.   State  railways    ... 
II.  Private  railways  (concessions) 
III.   Railways    of  the   second    class    and    steam 
tramways — 

A.  Public       

B.  Private      


Mileage. 

1765 

11,245 


119 
121 


General  total,  mileage  of  lines  in  operation 
General  total  on  September  1st 


...    13.250 
...   14,994 


These  lines  are  of  very  unequal  value  from  the  share- 
holders' point  of  view  ;  but  it  must  be  recognised  that  the 
majority,  after  various  vicissitudes,  have  of  late  years  shown 
an  increase  of  revenue  that  proves  their  vitality.     We  may 


98      THE  ARGENTINE  IN  THE  20th  CENTURY 

cite,  as  example,  one  of  the  Southern  lines,  such  as  that 
running  to  Bahia  Blanca  via  Tornquist  ;  a  line  built  almost 
at  a  loss  by  the  Southern  Railway  Company  of  Buenos  Ayres, 
but  which  to-day  is  yielding  over  4  per  cent.,  thanks  to 
the  agricultural  development  which  has  followed  its  course. 
According  to  iigures  of  reliable  origin,  the  traffic  of  this 
line  between  the  stations  of  General  La  Madrid  and  Bahia 
Blanca,  has  increased  from  63,580  tons  in  1888  to  458,750 
tons  in  1908,  or  an  increase  of  620  per  cent,  in  twenty  years, 
and  even  so  these  figures  do  not  include  the  through-goods 
traffic  between  these  points. 

Generally  speaking,  we  may  say  that  the  revenues  of  the 
Argentine  railways  more  often  than"  otherwise  exceed 
expectation,  even  in  the  case  of  new  lines.  On  the  other 
hand,  it  is  difficult  to  reduce  the  expenses  of  working,  on 
account  of  the  special  conditions  of  the  traffic,  which  is  only 
heavy  at  the  lime  of  harvest,  instead  of  being  distributed 
throughout  the  year. 

"  We  must  warn  the  reader  that  the  summary  just  given 
is  of  only  approximate  value.  To  avoid  wounding  the  sus- 
ceptibilities of  the  State,  or  in  order  not  to  justify  demands 
on  the  part  of  the  State  for  lower  tariffs,  certain  of  thie 
railroad  companies  publish  far  lower  profits  than  they 
really  make,  by  means  of  transforming  a  portion  of  their 
profits  to" the  reserve  or  redemption  accounts.  With  the 
same  object,  they  sink  considerable  sums  in  land  purchase 
or  in  permanent-construction  work. 

Other  companies,  on  the  contrary,  hoping  that  the  State 
will  eventually  take  over  certain  of  their  lines,  seek  to 
augment  their  returns  temporarily,  in  order  to  obtain  a 
better  sale  price. 

We  may  safely  say,  however,  the  administrative  methods 
of  the  greater  companies  being  what  they  are,  that  on  the 
whole  the  average  revenues  are  above  rather  than  below 
the  figures  we  have  given.  Accounts  are  conducted  on  a 
basis  of  very  cautious  evaluation,  in  order  to  lessen  the 
shock  of  a  bad  harvest. 

As  for  the  tariffs  of  the  various  companies,  they  are 
still  'very  high,  as  always  happens  when  there  is  no  com- 
petition. 


RAILWAYS  gg 

Here  are  some  of  the  prices  of  freight  per  ton,  according 
to  the  articles  and  the  distance  they  are  carried  :  * 

Up  to  so  kilometres            300  kilometres  or  700  kilometres  or 

or  30  miles.                          iSo  miles.  421  miles. 

Wheat         ...      48.  9-4d.  to  5s.6-5d.     lOs.  lid.  to  14s.  9-6d.  Hs.  9d.  to  17b.  2d. 

Wool  in  bale       5s.     8d.  to  128.  9d.     268.  3d.  to  398.    lid.  398.  2d.  to  588.  Id. 

Wool  in  sacks    Ms.  lid.  to  188.3 -Gd.     478.  6d.  to  588.     9d.  728.  3d.  to  93s.  8d. 

A  factor  that  makes  these  freights  seem  even  higher  is  a 
comparison  with  the  maritime  freights,  which  fell  in  1908  to 
a^'ery  low  figure.  The  transport  of  a  ton  of  cereals  to  a 
port  of  embarkation  3000  miles  distant  would  cost  a  farmer 
four  or  fivetimes  as  much  as  the  freight  from  that  port  _ti> 
Europe. 

In  a  country  like  the  Argentine,  presenting  an  immense'^ 
level  surface  to  the  eye,  which  can  hardly  distinguish  the 
slightest  landmark  or  difierence  of  level,  it  would  seem  as 
though  the  building  of  railways  should  have  been  particularly 
inexpensive,  especially  as  for  ten  to  twenty  years  all 
materials  could  be  imported  free  of  duty.  As  a  matter  of 
fact,  however,  the  cost  of  construction  has  been  very  high  /- 
in  the  case  of  certain  lines  ;  either  on  account  of  the  land 
speculation  which  has  followed  their  establishment,  or  because 
tlie  estimates  were  exceeded  having  been  established  without 
any  serious  control  on  the  part  of  the  State.  This  explains 
how  It  is  that  these  companies,  having  an  enormous  capital 
to  redeem,  cannot  at  the  present  moment  lower  their  rates. 

In  the  Argentine  the  railway  companies  are  not  established 
as  in~Trance,  by  right  of  a  concession  limited  to  a  certain 
numFer  of  years.!  The  concession  is  granted  without 
conditions,  excepting  the  reserve  that  it  may  be  redeemed 
by  the  State ;  and  this  reserve  maybe  applied  at  anytime 

*  The  Argentine  "tonne"  weighs  35  lbs.  less  than  the  English  ton  being 
1000  kilogrammes,  or  2205  lbs.  in  weight. 

t  A  clause  fixing  the  term  of  the  concession — that  is,  the  date  upon  which 
the  line,  with  all  its  buildings,  etc.,  will  pass  into  the  hands  of  the  Government 
without  any  payment  on  the  part  of  the  latter,  was  inserted  in  the  case  of  two 
railways  only,  and  for  a  term  of  fifty-five  years.  These  two  linos  are  the 
railway  from  Villa  Mercedes  to  La  Toma  (the  old  North-Western  Argentine), 
to-day  a  section  of  the  Andean  National,  and  that  from  San  Cristobal  to 
Tncuman,  to-day  the  Southern  Section  of  the  Central  Northern.  Both  are 
guaranteed  by  the  nation  ;  but  the  nation  having  become  the  proprietor,  the 
above  clause  has  of  course  not  taken  effect. 


100    THE  ARGENTINE  IN  THE  20th  CENTURY   ^ 

whatever,  conformably  with  the  expropriation  law.  The 
conditions  of  redemption  are  in  most  cases  estaBTTshedon 
the  basis  of  the  revenues  of  the  last  five  years,  increased 
by  20  per  cent.,  so  that  the  clause  can  scarcely  be  carried 
into  effect  to  the' profit  of  the  State  in  the  case  of  lines 
yielding  good  profits. 

The  State  and  the  Provinces  have  guaranteed  dividends  in 
various  wajs.  These  guarantees  were  granted  very  liT)erally 
when  the  Argentine  was  seeking  to  create  and  develop  its 
railway  system,  but  the  Governments  have  not  shown  the 
*same  readiness  to  honour  their  signatures  in  times  of  crisis. 
We  shall  see  in  the  financial  section  of  this  book  that  the 
State  has  had  to  contract  loans  in  order  to  redeem  its 
obligations,  and  to  liberate  itself  from  engagements^ it  had 
been  enable  to  keep.* 

At  present  the  Government  no  longer  gives  guarantees — 
not  "even  to  encourage  the  construction  of  lines  in  regions 
which  oflfer  little  attraction  from  the  point  of  view  of  traffig. 
It  prefers  to  build  them  itself,  in  order  to  increase  the  extent 
ifnot  the  value,  of  the  systems  it  already  owns;  or  has 
recourse  to  companies  or  private  individuals  for  the  construc- 
tion of  new  lines,  but  without  guarantees  of  any  sort. 

Having  given  these  details  of  the  railway  system,  we 
have  still  to  consider  of  what  expansion  it  is  still  capable. 
In  comparison  to  other  American  States — excepting  the 
United  States,  whose  colossal  progress  in  this  department 
permits  no  comparison  with  other  countries — the  Argentine^ 
is  in  the  first  rank  in  the  matter  of  its  railway  mileage.  With 
its  13,250  miles  in  operation  on  1st  January  1909,  it  surpasses 
both  Mexico  (with  8390  miles)  and  BrazilCwith  10,080},  the 
two  American  States  which,  being  the  wealthiest  and  having 
the  largest  populations,  possess  very  extensive  railway  systems. 
If  from  the  same  standpoint  we  then  compare  the  Argentine 
with  France,  Italy,  Spain,  Belgium,  England,  Germany,  and 
Austria-Hungary,  we  find  that  it  occupies  the  fourth  rank. 
But  it  goes  without  saying  that  these  figures  do  not 
mean   anything   very   precise,  except   in   conjunction   with 

*  The  French  company  of  the  Santa  Fe  Railways,  which  had  a  guarantee 
from  the  Province,  which  guarantee  was  never  paid,' obtained  in  exchange,  by 
arrangement,  the  complete  uwnership  of  its  lines. 


RAILWAYS  10 ; 

those  denoting  the  area  and  the  population  of  the 
Argentine.  They  are  indications  rather  than  exact  com- 
parisons. 

If  we  compare  the  number  of  miles  of  railway  in  operation 
to  that  of  the  area  in  square  miles  of  each  country,  we  shall 
find  that  among  the  nations  of  South  America  the  first  place 
is  no  longer  held  by  the  Argentine,  but  by  the  little  Eastern 
Republic  of  Uruguay,  for  in  the  former  country  the  ratio  is 
only  1"25,  while  in  the  second  it  is  1*67.  Mexico  ties  with 
the  Argentine,  with  1-25.  Here  is  an  example  of  the  strange 
conclusions  to  which  statistical  inquiry  sometimes  leads  us, 
since  it  follows  from  the  preceding  figures  that  Uruguay, 
with  only  1207  miles  of  railway,  and  71,990  square  miles  of 
territory,  holds  apparentl}^  from  this  standpoint,  a  higher 
rank  than  the  Argentine. 

The  comparison  of  the  mileage  of  the  railways  of  each 
country  to  the  number  of  its  inhabitants  is  an  exacter  method. 
We  find  that  for  every  10,000  inhabitants  the  Argentine 
has  23"59  milesTof  railw^y^  while^razil  has  only  649, 
Uruguay  rO-96,  Uhiir'S;587  Mexico  7  1 2,  and  Venezuelans 
miles^ 

All  this  is  explained  in  the  following  table,  whence  in- 
teresting deductions  may  be  drawn.  \ 

The  mileage  of  railway  given  for  the  Argentine  should  ^ 
be  regarded  as  provisional,  for,  unlike  those  European  nations 
whichT  have  almost  attained  their  uttermost  expansion  and 
equipment,  there  is  still  much  to  be  done  in  the  Argentme 
before  the  whole  of  its  territory  can  be  served.  Certainly 
t'Ee'  principaTIines  are  already  constructed,  but  others  will 
assuredly  be  built,  which,  apart  from  their  immediate 
utility,  will  ultimately  pay,  owing  to  the  manner  in  which 
they  will  increase  the  value  of  the  soil  which  they  will 
traverse. 

The  constant  expansion  of  its  network  of  railways  is  for  i) 
that  master  a  necessity  to  the  Argentine,  as  for  all  new  coun- 
tnesTihTwhich  there  are  no  roads  fit  for  wheeled  traffic.  Rather 
than  go  to  the  expense  of  opening  up  such  roads,  which  would 
be  an  unproductive  investment,  the  Government  prefers  to 
favour  the  creation  of  lines  of  railroad  which  may  in  time 
become  instruments  of  production. 


<- 


.102  .THE  ARGENTINE  IN  THE  20th  CENTURY 


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RAILWAYS  103 

It  is  true,  as  we  stated  in  the  first  edition  of  this  book, 
that  numerous  demands  for  concessions  permittincr  new 
lines  to  be  built  have  been  presented  to  and  granted  by  the 
National  Congress.  But  it  is  also  true  that  only  a  very 
small  number  of  these  projects  have  been  realised,  as  many 
of  these  undertakings  were  unable  to  find  the  capital 
necessary  to  flotation  in  the  foreign  markets ;  this  has  been 
true  particularly  of  the  English  market. 

At  the  same  time,  there  are  among  these  concessions 
a  few  projects  which  seem  to  be  capable  of  immediate 
realisation  ;  these  are  concessions  granted  to  already  existing 
companies,  for  the  extension  of  their  systems,  which  have 
the  necessary  capital  at  their  disposal. 

Among  new  lines  in  active  construction  we  must  cite 
that  for  which  the  concession  was  granted  to  MM.  de  Bruyn 
and  Otamendi :  a  narrow-gauge  railway  in  the  Province  of 
Buenos  Ayres.  This  concession  has  been  taken  over  by 
a  French  company,  and  may  require  a  maximum  capital  of 
£8,000,000. 

This  undertaking,  which  is  really  the  extension  into  the 
Province  of  Buenos  Ayres  of  the  network  of  narrow-gauge 
lines,  exploited  by  the  French  company  of  the  Santa  Fe 
Railroads,  includes  several  long  lines  starting  from  Rosario, 
crossing  the  most  productive  and  thickly-peopled  region? 
of  the  West,  and  terminating  at  the  three  great  centres  of 
export:  Buenos  Ayres,  Bahia  Blanca,  and  La  Plata. 

This  undertaking,  which  has  been  well  thought  out  by 
its  promoter  and  present  director,  the  engineer  Girodias, 
is  based  upon  two  ideas ;  one  being  to  build  cross  lines 
connecting  the  pi-incipal  railways  of  the  south  and  the  west 
in  agricultural  districts  where  these  two  lines  hold  an 
absolute  monopoly ;  the  other  is  to  extend  to  Buenos  Ayres 
the  narrow-gauge  system  of  the  north  and  north-west. 
This  system  consists  at  present  of  3444  miles  of  railways, 
having  their  terminus  at  Rosario;  it  is  therefore  most 
desirable  that  these  lines  should  be  prolonged  towards  the 
south,  and  especially  as  far  as  the  capital,  in  order  to  avoid 
troublesome  transhipments.  This  will  be  a  great  advantage, 
for  example,  to  the  sugar-growing  districts  of  Tucuman. 

At  the  present  moment,  this  new  narrow-gauge  system  is 


104    THE  ARGENTINE  IN  THE  20th  CENTURY 

already  working  from  Rosario  to  Buenos  Ayres,  the  equip- 
ment being  excellent,  and  westward  as  far  as  Nuevo  de 
Julio.  The  first  results  have  confirmed  the  forecasts  as 
to  the  development  of  traffic  in  this  region. 

Another  concession  for  a  line  on  the  same  basis  is  that 
obtained  b}^  Mr  Duncan  Munroe,  for  the  establishment  of  a 
narrow-gauge  railway  between  Rosario  and  Buenos  Ayres, 
to  be  a  prolongation  of  the  "  Central  Cordoba  ",  of  which  he 
is  the  Director.  This  scheme,  thanks  to  the  support  given 
by  the  "Central  Cordoba  and  the  Cordoba  and  Rosario,"  has 
been  put  into  execution,  and  is  on  the  eve  of  being  opened 
to  the  public. 

The  proposal  to  unite  Rosario  and  Bahia  Blanca — the  two 
chief  Argentine  ports — by  a  line  crossing  the  Province  of 
Buenos  Ayres  in  its  most  fertile  region,  is  also  on  the  way 
to  completion.  The  construction  of  this  line  is  being  actively 
pushed,  so  that  it  is  hoped  that  the  line  may  be  open  for 
service  in  the  course  of  1910. 

This  important  line  is  being  built  by  French  capital,  the 
executive  being  known  as  the  Rosario  and  Puerto  Belgrano 
Railways  Company. 

The  National  Congress  has  also  granted  to  existing 
companies,  which  can  offer  all  requisite  guarantees,  the 
authorisation  to  construct  new  branch  lines,  which  will 
attain  a  total  length  of  3870  miles,  and  will  absorb  a  capital 
of  £25,000,000.  Of  this  total,  797  miles  will  be  built  by  the 
Western  Railways  Company,  874  by  the  Southern  Railway 
Company,  328  by  the  Pacific  Company,  192  by  the  Central 
Cordoba,  427  by  the  Rosario  and  Puerto  Belgrano  Railway, 
190  by  the  Province  of  Buenos  Ayres  Railways,  87  by  the 
French  Company  of  the  Province  of  Santa  Fe  Railways,  and 
476  by  the  Central  Argentine  Railway. 

Apart  from  the  capital  of  companies  already  established 
in  t'Ee~Argentirie,  one  may  already  detect^a'new  stream  of 
foreign  capital  destined  to  build  new  railways.  It  Js 
announced,  indeed,  that  a  new  railway  sj^stem,  223  miles  in 
length,  will  shortly  be  built  in  Entre  Rios  by  German  capital, 
■^^ch  has  hitherto  been  shy  of  this  kind  of  undertaking. 

The  Province  of  Buenos  Ayres  also  proposes  to  construct 
and  exploit  on  its  own  account  a  narrow-gauge  line  running 


RAILWAYS  105 

from  La  Plata  in  the  direction  of  the  fifth  meridian.  For 
this  undertaking  French  capital  will  also  be  solicited. 
j  "Finally,  the  National  Government,  not  -wishing  to  remnin 
I  inactive  in  the  midst  of  these  civilising  activities,  has  just 
obtained  the  approval  of  Congress  for  a  vast  scheme  of 
populating  the  southern  territories  of  the  Republic  ;  a  scheme 
initiated  by  an  ex-Minister  of  Agriculture,  Dr  Ramos 
Mexia,  the  basis  of  which  is  the  construction  of  over  1200 
miles  of  railway,  along  which  new  centres  of  colonisation 
will  gradually  be  formed. 

This  is  the  great  object  of  the  present  Government.  It 
has  taken  shape  in  the  form  of  a  law,  having  as  its  especial 
object  the  development  of  the  national  Territories,  and 
having  regard  both  to  the  creation  of  new  railways  and  the 
progress  of  colonisation  ;  problems  closely  connected  where 
the  opening  up  of  a  new  country  is  concerned,  and  value  is 
given  to  its  soil. 

The  plan  adopted  by  the  Government  is  first  of  all  to 
build  the  railway,  which  is  the  great  instrument  of  civilisa- 
tion ;  then  to  profit  by  the  increased  value  which  the  land 
will  immediately  take  on  along  its  course,  by  divj^ding  and 
selling  it  with  a  view  to  colonisation.^  The  most  immediate 
result  of  this  policy  is  that  the  soil,  which  has  hitherto  been 
uncultivated  or  abandoned,  rapidly  attains  a  double  or  treble 
value.  The  same  thing  happens  when  irrigation  works  are 
carried  out,  as  they  may  be  in  certain  districts,  rendering 
productive  soil  that  has  hitherto  been  uncultivable  for  want 
'  of  water.  We  may  cite  the  Rio  Negro  among  those 
Territories  in  which  recent  attempts  have  been  made  to 
realise  the  value  of  the  soil,  and  towards  which  the  attention 
of  capitalists  as  well  as  colonists  has  lately  been  directed. 

To  ensure  the  carrying-out  of  these  schemes,  the  State 
usually  has  recourse  to  contractors  who  accept  payment  in 
Government  bonds,  with  a  margin  of  profit  sufficient  to  pay 
them  for  their  enterprise.  We  may  therefore  say  that  the 
affair  is  good  for  every  one,  and  that  it  is  as  much  to  the 
advantage  of  the  State  as  to  the  profit  of  the  capitalists  who 
take  up  these  proposals. 

Finally,  if  we  wish  to  estimate  the  probable  development 
.    of  the  Argentine  railways,  basing  our  figures  not  on  the 


106    THE  ARGENTINE  IN  THE  20th  CENTURY  j 

concessions  granted,  which  already  amount  to  a  length  of 
more  than  9000  miles,  but  on  the  possibilities  of  obtaining 
capital,  we  may  reasonably  give  4500  miles  as  a  probable 
figure  of  growth.  To  this  figure  we  must  also  add  that  of 
the  lines  now  under  construction,  either  on  behalf  of  the 
State  or  by  existing  companies,  which  on  the  1st  of  January 
1908  amounted  to  a  total  of  4800  miles,  of  which  973  belonged  ;■ 
to  the  State  railways  and  3827  to  private  companies.  | 

We  may  thus  legitimately  estimate  that  in  the  coming  :| 
years  the  Argentine  railway  system  will  be  increased  by  • 
some  6200  miles,  making  a  total  of  nearly  19,000  miles.  \ 
But  to  keep  to  solid  fact,  we  must  add  that  such  develop-  I 
ment  depends  on  continued  agricultural  prosperity,  the  rapid  :l 
increase  of  ploughed  lands,  and,  above  all,  on  a  brisk  immi- 
gration ;  for  these  conditions  are  indispensable  to  all  fresh 
progress  in  the  Argentine.  -  ^  ^ 

In  this  large  increase  of  railroad  construction  we  may 
perceive  at  the  same  time  the  application  of  a  new 
programme.  The  State  to-day  especially  favours  the  con- 
struction of  a  second  network  of  economical  railvra^s, 
running  between  the  broad-gauge  lines  or  even  crossing 
them  diagonally — completing  them,  in  fact,  and  duplicating 
them.  The  aim  of  this  policy  is  not  only  to  respond  to  t_he 
development  of  traffic  caused  by  abundant  harvests,  but  also 
to  lower  freights  by  the  establishment  of  competition. 

As  an  element  of  the  future  railway  system  of  the 
Argentine,  we  may  also  include  the  lines  of  communication 
with  Chili,  across  the  Cordillera,  so  soon  as  they  are  open 
to  through  traffic.  At  the  present  time  the  Trans- Andean 
railway  on  the  Argentine  side  of  the  range  has  reached  the 
frontier  of  Chili  at  Las  Cuevas,  10,000  feet  above  sea-level ; 
and  on  the  further  side  the  Chilian  Government  is  hastening 
the  work  of  construction  on  its  own  Territory,  so  that  it  only 
remains  to  complete  the  two  miles  of  tunnel  in  order  to  open 
the  whole  line  to  traffic*  Once  in  operation,  the  journey 
between  Valparaiso  or  Santiago  and  Buenos  Ayres  will 
occupy  less  than  forty  hours,  while  at  present,  by  the  sea 
route,  it  takes  twelve  to  fifteen  days,  and  involves  the 
difficulties  of  navigating  the  Strait  of  Magellan. 

*  This  line  is  now  open. — [Teans.] 


RAILWAYS  107 

The  line  is  narrow-gauge,  and  some  8i  miles  of  it  is 
worked  on  the  rack  and  pinion  system.  The  highest  point 
will  be  about  1480  feet  above  sea-level,  in  a  tunnel  1-92 
miles  in  length,  of  which  105  miles  will  be  in  Argentine  and 
•87  on  Chilian  territory. 

The  Southern  Railway  has  also  a  line  which  at  present 
runs  as  far  as  Neuquen.  The  Directors  of  the  company  have 
ordered  the  continuation  of  this  line  into  Chili,  going  by 
way  of  Antuco,  thus  establishing  a  direct  route  between  the 
south  of  Chili  and  the  agricultural  districts  of  the  Ai'gentine. 

Despite  the  formidable  barrier  raised  by  the  range  of  the 
Andes,  the  Argentine  and  Chili,  two  nations  having  the  same 
origin,  with  a  common  frontier  of  3000  miles,  are  destined, 
by  means  of  their  railways,  to  an  increasing  closeness  of 
relation.  Chili  is  a  country  poor  in  cereals,  and  in  especijil 
does  not  raise  sufficient  cattle  for  the  needs  of  her  population. 
On  the  other  hand,  she  produces  wines  which  are  highly 
appreciated  in  the  Argentine.  There  may  thus  spring  up" 
between  the  two  countries  an  exchange  of  products,  which  the 
railways  will  certainly  increase,  and  which  will  give  the 
Argentine  railroad  system  the  benefit  of  international  traffic. 

To  complete  this  sketch  of  the  Argentine  railways,  and  of 
the  progress  they  have  realised,  we  must  not  fail  to  speak 
of  the  construction  of  an  industrial  traffic-way  which  has 
established  a  remarkable  record — not  only  in  South  America, 
but  over  the  whole  world.  We  refer  to  the  suspended  railway, 
constructed  in  the  Province  of  La  Rioja  under  the  last  Pre- 
sidency of  General  Roca,  in  order  to  carry  down  to  the  plains 
the  produce  of  the  famous  Famatina  and  Mexicana  mines. 

This  suspended  way,  which  is  over  21  miles  in  length, 
and  which  cost  £76,000,  is,  in  the  words  of  M.  Civit,  the 
Minister  of  Public  Works,  who  inaugurated  it,  the  longest 
traffic-way  of  this  kind  in  the  two  worlds.* 

♦  As  for  the  probable  profits  of  this  line,  the  Minister  makes  the  following 
statement:  "In  counting  on  a  minimum  traffic  of  50  tons  a  day  during 
nine  months  in  the  year — an  amount  based  upon  the  present  yield  of  the  mines — 
and  deducting  50  per  cent,  of  the  gross  receipts  for  working  expenses — which  is  a 
maximum — we  find  that  to  obtain  6  per  cent,  interest  on  the  capital  employed,  it 
would  be  sufiBcient  to  receive  3-36  paper  piastres,  or  7-6  francs  (6  shillings 
•96  pence)  per  ton  of  ore,  whereas  the  mining  companies  with  the  present 
r«souroo9  pay  20  piastres." 


108    THE  ARGENTINE  IN  THE  20th  CENTURY 

"  It  glides  amid  the  snows  and  the  tempests,  crossing  abysses 
thousands  of  feet  in  depth,  and  ending  at  a  height  of  15,000 
feet.  The  highest  of  its  towers  is  as  high  as  the  summit  of 
Mont  Blanc,  and  the  mines,  into  whose  bowels  it  enters,  will 
take  their  place,  like  those  of  Rio  Tinto  and  Bilbao,  in  the 
commerce  of  the  world,  as  the  agricultural  products  of  the 
Argentine  have  already  done ;  thus  drawing  all  eyes  to  this 
privileged  country,  which  is  set  apart  for  the  most  brilliant 
destiny." 

If  we  now  consider  the  part  played  by  the  railways  in 
the  general  development  of  the  Argentine,  we  are  forced  to 
recognise  that  in  a  country  so  essentially  agricultural,  the 
railroad  is  an  indispensable  auxiliary  of  production.*  The 
Argentine  Republic  is  a  large  country,  containing  1,155,000 
square  miles  of  territory,  and  is  barely  peopled  by  its 
0,000,000  inhabitants ;  it  will  therefore  be  understood  that 
instead  of  following  the  population,  as  in  Europe,  in  the 
Argentine  the  railway  precedes  the  population.  In~tEe 
Argentine  the  railway  is  like  a  magic  talisman,  for  wherever 
it  goes  it  entirely  transforms  the  economic  and  productive 
conditions  of  the  country. 

We  have  seen  that  in  the  matter  of  transport  agriculture 
will  shortly  enjoy  improved  conditions;  there  will  be  greater 
facilities  for  bringing  its  products  to  the  ports  of  embarka- 
tion, and  placing  them  in  the  centres  of  consumption.  But 
what  are  these  conditions  at  present  ?  What  is  the  precise 
relation  between  the  railways  and  agriculture  ?  Are  they 
sufficient  for  the  rapid  transport  of  the  harvests?  This 
inquiry,  which  is  of  immediate  interest,  has  been  made  by 
M.  Emile  Lahitte,  Director  of  the  Division  of  Statistics  in 
the  Ministry  of  Agriculture,  with  his  usual  competence  and 
practicaljgood  sense.  We  will  take  certain  useful  data  from 
this  source,  without  prejudice  to  other  data  which  we 
have  collected,  while  profiting  by  the  experience  of  other 
personalities  equally  well  informed. 

One  of  the  most  characteristic  peculiarities  of  agricultural 

*  Among  matters  still  under  cocsideration  in  the  Argentine,  we  may 
mention  the  concession  for  the  port  and  railway  of  Samborombon,  -which 
■would  connect  with  a  system  of  narrow-gauge  railways  leaving  Samborombon, 
which  would  be  a  great  Atlantic  port,  and  running  to  the  end  of  the  Territory 
of  Pampa  Central,  thus  facilitating  the  export  of  its  products 


RAILWAYS  109 

production  in  the  Argentine  is  the  fact  that,  conversely  to 
tlie  production  of  the  United  States,  about  80  per  cent,  of  the 
liarvest,  and  perhaps  even  more,  goes  to  fill  foreign  markets,  / 
lo.ivingoul}'  20  per  cent,  for  home  consumption  ;  andnot  onlyis 
it  necessary  to  export  this  surplus,  but  it  has  to  be  exported 
with  as  little  delay  as  possible.    In  the  United  States  the  annual 
cereal  harvest  amounts  to  about  4000  millions  of  bushels,  of 
which  scarcely  10  per  cent,  or  12  per  cent,  are  destined  for  ex- 
port.    The  rest  remains  in  the  granaries,  and  is  manipulated,' 
during  the  rest  of  the  year,  in  response  to  the  needs  of  a 
population  of  80  million  inhabitants.     But  in  the  Argentine, 
supposing  the  harvest  of  wheat,  flax,  and  maize  to  amount 
i  to  400  million  bushels,  one  might  count  upon  the  exportation      i 
'  of   320    millions,  the  80  millions  remaining  for  home   con- 
sumption. 

From  the  commercial  point  of  view,  agricultural  produc- 
tion thiis  depends  chiefly  on  the  importing  market^.  This  — 
is~so  far  the  case  that  if  we  look  into  the  monthly  figures 
of  exportation,  remembering  that  threshing  begins  at  the 
end  of  December  and  continues  sometimes  into  March  or 
April,  we  shall  find  that  by  June  three-quarters  of  the  year's 
export  has  already  been  shipped.  The  exportation  of  wheat  in 
1907  amounted  to  100  million  bushels,  and  by  the  end  of  iJune 
79  million  bushels,  or  79  per  cent.,  had  already  been  shipped. 
The  quantity  of  maize  exported  during  the  same  year  was 
48  million  bushels,  and  in  October,  that  is,  five  months  after 
the  harvest,  40  millions  had  already  been  shipped ;  that  is, 
84  per  cent.  The  statistics  of  the  carriage  of  cereals  by  railroad 
also  clearly  prove  the  pressure  and  congestion  existing  in 
the  months  following  the  harvest. 

From  this  peculiarity  it  follows  that  there  is  always  a 
struggle  latent  between  the  exporters  of  agricultural  produgg  ' 
and"  the  transport  companies.  In  some  cases,  as  in  1905,  this 
struggle  took  the  form  of  "judicial  protest;  the  chief  export 
houses  sued  the  "  Great  Southern  of  Buenos  Ayres"  for  dam- 
ages in  respect  of  unjustifiable  delay  iriThe' transport  of  cereals. 
It  must  be  admitted,  however,  that  the  railway  companies 
are  not  always  the  cause  of  such  delays  in  export ;  there 
are  other  factors  also  which  we  must  take  into  account  and 
consider  in  relation  to  the  national  production. 
H 


no    THE  ARGENTINE  IN  THE  20th  CENTURY 

One  of  the  elements  which  influence  the  regularity^pf 
transport  is  the  amount  of  cargo-room  available  at  the  ,gorts. 
When  there  are  many  steamers  and  sailing-ships  in  port 
the  shipping  rates  fall  ;  the  exporters  hurry  to  makjg 
contracts  with  the  shipping  lines,  and  in  order  to  be  in  time 
to  avoid  surcharges,  they  demand  a  large  number  of  goods 
wagons  of  the  railways,  which  the  latter  naturally  cannot 
always  produce.  The  law  states  that  the  railway  companies 
must  maintain  a  goods  service  equal  to  the  normal  demands 
of  the  trafiic ;  and  the  demands  created  by  the  accidental 
causes  we  have  mentioned  are  not  normal. 

On  the  other  hand,  if  the  shipping  contracts  are  high,_or 
the  prices  in  the  consumers'  market  low,  the  buyers  will  be 
unwilling  to  despatch  their  cereals  to  the  ports  of  embarka- 
tion, and  the  railway  companies  can  do  nothing  to_dear_their 
stations  of  large  quantities  of  accumulated  grain,  which  they 
cannot  forward,  since  the  buyers  will  not  give  the  order  for 
their  despatch. 

During  a  recent  harvest  both  these  phenomena  were 
observed  ;  on  the  Southern  Railway  the  harvest  was  abundant 
in  quantity  and  good  in  quality,  but  only  a  small  numberjof 
steamers  were  lying  in  the  terminal  port  (Engineer  White 
Harbour)  ;  every  exporter  in  the  district  wanted  to  ship  at 
once,  but  the  railway  could  carry  only  what  it  was  capable 
of  carrying  in  a  normal  period. 

It  was  another  affair  in  the  districts  served  by  the 
Central  Argentine  and  the  Buenos  Ayres  and  Rosario 
Railways.  Here  the  wheat  was  scanty  and  of  poor  quality, 
and  the  buyers  had  sent  very  little  to  their  port  of  embarka- 
tion— Rosario.  They  preferred  to  send  their  purchases  to 
the  grain-elevators  of  Buenos  Ayres,  where,  by  means  of 
blending  the  central  with  the  southern  wheat,  a  special  grade 
of  flour  was  produced,  superior  to  that  produced  in  the 
districts  served  by  the  above  two  companies. 

The  best  solution  of  this  question  of  the  responsibility  of  | 
the  railway  companies  toward  the  despatchers  would  be  a 
rule  that  the  railways  should  be  obliged  to  despatch  in  the 
course  of  a  day  only  the  amount  of  produce  sent  to  the 
stations  during  the  same  lapse  of  time.  But  the  exporters 
arc  generally  Argentines,  while  the  railways  are  usually  in 


RAILWAYS  HI 

foreign  handsj  so  that  this  solution,  though  equitable,  would 
not  be  regarded  with  much  favour,  and  it  is  probable  that 
the  railway  companies  will  be  called  upon  to  remedy  this_ 
situation,  so  unfavourable  to  Argentine  commerce,  at  their 
own  co^ 

Let  us  now  see  how  far  the  railways  have  responded  to 
the  increase  of  agricultural  productions. 

According  to  the  official  statistics,  in  1895  the  Argentine 
Republic  contained  8760  miles  of  railways,  and  the  merchan- 
dise transported  by  the  various  railway  companies  during 
that  year  amounted  to  9,811,100  tons.  In  1907  the  railway 
systems  had  increased  to  a  total  length  of  14,000  miles, 
while  the  produce  carried  during  the  preceding  year  amounted 
to  28,394,500  tons.  These  figures  represent  an  increase  of 
rather  more  than  59  per  cent,  in  railway  mileage,  while  the 
transports  had  nearly  trebled  in  twenty  years. 

According  to  the  same  authorities,  between  1897  and  the 
end  of  1907  the  rolling  stock  and  the  capacity  of  the  goods 
cars  increased  in  the  following  proportions  : — 


Year. 

Number  of  Cars. 

Capacity  in  Tons 

1899 

32,897 

369,764 

1900 

34,118 

398,736 

1901 

35,503 

432,342 

1902 

36,288 

466,667 

1903 

36,334 

480,498 

1904 

38,724 

570,600 

1905 

42,623 

688,308 

1906 

48,840 

878,886 

1907 

52,405 

1,029,122 

From  these  figures  we  obtain  the  increase  in  the  number 
of  cars  of  produce  and  their  contents  in  tons  ;  but  it  is  more 
to  the  point  to  know  how  their  rolling-stock  is  utilised. 
According  to  M.  Lahitte,  the  normal  distance  travelled  by 
a  goods  car  is  6210  miles  in  a  year;  but  to  judge  by  the 
statistics  its  actual  record  is  always  in  excess  of  this  figure, 
since  in  1902  the  distance  travelled  exceeded  8910  miles  per 
car.  It  is  evident,  therefore,  that  the  rolling-stock  has  been 
run  to  its  utmost  capacity  ;  but  it  is  also  evident  that  in 
practice  the  cars  have  not  been  loaded  to  their  utmost 
capacity,  as  the  normal  load  is  4*37  tons  per  car,  while  the 
average  load  actually  carried  has  been  hardly  170  tons. 


112    THE  ARGENTINE  IN  THE  20th  CENTURY 

It  follows  accordingly  that,  in  spite  of  the  distance  travelled 
per  "car,  the  companies  have  only  profited  to  the  extent  of 
39  per  cent,  of  the  capacity  of  their  rolling-st9ck  ;  but  we  must 
not  forget  that  there  is  always  a  difference  between  theoretical 
capacity  and  effective  capacity,  which  varies  according  to 
the  nature  of  the  load.  This  fact  is  further  explained  when 
we  add,  as  we  must,  that  out  of  a  hundred  cars  sixty-nine  make 
the  journey  loaded  while  thirty-one  go  or  return  as  "empties," 

We  see  from  these  data  that  although  the  Argentine  ■ 
railw"ays  possess  more  than  enough  rolling-stock  for  the 
rapid  transport  of  all  agricultural  products  to  their  ports 
of  embarkation  or  destination,  yet  in  practice,  on  account 
of  the  abnormal  character  of  the  traflBc,  the  railways  only- 
very  imperfectly  perform  the  services  which  they  ought_to  \ 
perform,  while  the  fault  can  hardly  be  imputed  to  them.  j 

•^      But   this   trouble   will    disappear   as   soon   as   the  large    \ 
buyers  of  cereals,  in  place  of  "expecting  everything  from  the    ; 
railway  companies  in  the  matter  of  rapid  transport,  while 
they  themselves  wait  to  despatch  their  crops  until  the  inter- 
national prices  are  favourable,  finally  decide  to   build  the   . 
granaries  and  warehouses  which  they  now  demand   of  the   j 
railway  companies.     To  simplify  the  task  of  these  companies,  ; 
elevators  should  be  erected  at  the  stations  which  serve  the 
important  agricultural  zones,  so  that  the  cereals  could   be 
graded  before  loading  them  on   special  cars,  which    would  j 
then  transport  them  to  the  elevators  of  the  principal  ports,  ' 
whence  they  would  glide  into  the  holds  of  vessels  specially 
prepared  for  the  trade.     But  all  this  would  require  materials  , 
and   plant  which  the  country  does  not  so  far  possess;  yet  j 
with  the  rapid  agricultural  progress  of  the  Argentine,  the  '■ 
plan  should  be  easy  of  accomplishment. 

As  will  be  seen  by  the  data  we  have  given,  the  method  ; 
of  despatch  is  quite  unlike  that  practised  abroad.  While  jn  { 
Europe  the  railway  depots  only  receive  goods  for  immediate  } 
transit,  the  Argentine  grain-merchant  expects  the  depot  to  ^ 
serve  him  for  a  warehouse  until  the  moment  he  receives  ' 
a  telegram  and  requires  the  railway  to  transport  to  the  ; 
port  of  embarkation,  without  delay,  the  large  quantities  of  li 
grain  accumulated  at  the  stations.  ! 


CHAPTER  III 

IMMIGRATION    AND   COLONISATION 

Immigration  is  a  vital  prolilom  for  the  Argontinc — Tahlo  of  tho  population  per 
Province  and  per  Territory.  Its  sparsity — The  oscoplioiial  situation  of 
the  Argentine  as  the  objective  of  European  emigration — The  poor  resultK 
hitherto  obtained  through  default  of  colonisation — The  faulty  diviBion  of 
the  public  lands — History  of  immigration  in  relation  to  coloiiiKation — The 
nationality  of  immigrants. 

THE  economic  and  financial  orcranisation  of  the  Ar<]jentine 
being  now  assured,  and  peace  without  and  within  being 
established,  while  at  the  same  time  tlie  revolutionary  spirit 
of  the  bad  old  days  has  gradually  disappeared,  the  great 
problems  which  the  country  has  to  face  to-day  are  piTncipally 
tTiose  dealing  with  the  development_iiL_agricultural  alid 
Industrial  production  and  its  outlets. 

*"  But  among  these  problems  none  is  more  vital  to  the 
future  of  the  Argentine  than  the  problem  of  filling  the  vast 
gaps  of  empty  territory  with  new  elements  of  population. 

Here,  according  to  the  last  official  data,  are  the  figures 
relating  to  the  distribution  of  the  population  in  the  Provinces 
and  National  Territories  : — 


Province 


Area  in  sij.  miles 

Population  in  iyo8 

of  Buenos  Ayres 

and  Capital 

117,563, 

2,427,628 

„  Santa  Fe   ... 

50,784 

772,410 

„  C(5rdoba    ... 

62,000, 

477,680 

,,  Entre  Rios 

28,709 

399,333 

,,  Corrientes 

32,494 

317,247 

,,  Tucuman 

8,903 

280,311 

,,  Santiago  de  I'Estero       

39,660 

192,639 

„  Mendoza  .. 

56,350 

174,019 

„  Salta 

62,040 

141,610 

,,  Catamarca 

48.408 

103,680 

,,  San  Juan  ... 

33,630 

105,684 

,,  San  Luis  ... 

28,460 

103,367 

,,  La  Rioja   ... 

34,4.^.0 

86,352 

,,  Jujuy 

Carry  forwanl. 

18,930 

56,945 

622,381 

5,328,907 

113 

14    THE  ARGENTINE  IN  THE  20th  CENTURY 


Area  in  sq.  miles      Population  in  igo8 


Brought  forward, 
Territory  of  the  Pampa 
,,  ,,  Misiones    ... 

,,  ,,  Neuquen   ... 

,,  ,,  Rio  Negro 

,,  ,,  Chaco 

,,  ,,  Formosa    ... 

„  „  Chubut      

,,  ,,   Santa  Cruz 

,,  ,,  Las  Andes 

,,  ,,  Tierra  del  Fnego 


(322,381 

5,328,907 

5G,170 

51,673 

8,590 

38,748 

42,235 

18,020 

75,726 

15,961 

52,604 

13,838 

41,294 

6,309 

92,680 

5,244 

107,860 

•f -1,742 

24,980 

"  1,245 

8,277 

1,222 

1,137,803 


5,792,807 


The  above  fifjures  prove  more  eloquently  than  any  other 
argument  that  the  supreme  necessity  of  the  Argentine  people 
at  the  present  time  is  an  increase  of  population.  The 
territory  of  the  Republic  has  an  area  of  more  than  1,130,000 
square  miles,  and  its  population  amounts  to  no  more  than 
5,792,807,  which  gives  a  density  of  5-1  persons  per  square 
mile.  One  should"also  recollect,  in  order  to  grasp  the  true 
significance  of  these  figures,  that  of  those  5,792,807  in- 
habitants, 157,963  inhabit  the  43,000  acres  which  form  the 
site  of  Buenos  Ayres;  so  that  only  4,634,844  remain  to 
people  the  rest  of  the  country,  a  fact  which  still  further 
lessens  the  density  of  the  population. 

This  density  varies  in  different  regions  aud  in  different 
Provinces  ;  thus  the  eastern  or  coastal  region,  formed  by_the 
Federal  Capital  and  the  Provinces  of  Buenos  Ayres,  Santa 
F6,  Entre  Rios,  and  Corrientes,  has  17-08  inhabitants  to  the 
square  mile,  while  that  of  the  centre,  which  comprises 
Cordoba,  San  Luis,  and  Santiago  de  I'Estero,  has  only  5:^. 
As  we  penetrate  further  inland  the  density  grows  still  less, 
until  in  the  western  or  Andean  region,  formed  by  the 
Provinces  of  Mendoza,  San  Juan,  La  Rioja,  and  Catamarca, 
the  figure  is  barely  2-7.  In  the  northern  region,  embracing 
the  Provinces  of  Tucuman,  Salta,  and  Jujuy,  there  are  5;23 
inhabitants  per  square  mile. 

But  it  is  in  the  National  Territories — in  one  of  which 
more  than  one  important  European  people  could  find  room 
to  spare— that  we  find  the  lowest  density.  There  the  desert 
reigns  in  all  its  desolation.  The  Territory  of  El  Pampa, 
whence  so  much  wealth  has  been  drawn  of  late  years,  and 


IMMIGRATION  AND  COLONISATION  116 

whose  area  is  56,200  square  miles,  contains  barely  52,000 
inhabitants  ;  that  of  Rio  Negro,  wliose  area  is  45,000  sciuarc 
miles,  contains  but  16,000,  while  in  the  Territory  of  Santa 
Cruz,  situated  on  the  shores  of  the  Atlantic,  in  which  there 
are  important  ranches,  and  which  might  contain  a  numerous 
pastoral  and  maritime  population,  there  are  only  1742  souls 
to  its  58,890  square  miles.  All  these  figures  prove  that  the 
Argentine  is,  without  metaphor,  a  desert  nation,  and  that 
for  the  present  and  for  a  long  time  to  come,  its  peopling  will 
constitute  its  great  national  need. 

To  this  affirmation  we  must  add  another  no  less  certain : 
that  in  the  normal  order  of  human  events,  and  in  accordance 
with  the  economic  and  sociological  laws  that  govern  European 
nations,  there  is  no  country  in  the  world  which  assures  the 
labourer  who  establishes  himself  upon  its  soil  of  such 
perspectives  of  wealth  and  welfare.  All  things  compete  to 
make  it  a  paradise  of  immigration  :  the  softness  and  variety 
of  its  climate,  the  richness  of  its  soil,  the  extent  of  its 
territory,  the  enormous  inland  waterways  which  cross  it, 
and  the  facilities  of  communication  with  the  European 
consumers  of  its  produce,  with  whom  the  Argentine  is 
connected  by  one  of  the  most  reliable  ocean  traffic-ways  in 
the  world.* 

The  United  States,  which  have  hitherto  been  the  objective 
and  centre  of  attraction  to  which  men  of  initiative  have 
converged  from  all  parts  of  the  world,  are  beginning  to 
experience  all  the  troubles  familiar  to  European  nations  as 
the  result  of  an  excessive  population.!     It  is  for  this  reason 

*  The  distance  of  nearly  7200  miles  from  Buenos  Ayres  to  the  French  ports 
is  crossed  by  the  great  transatlantic  liners  in  from  eighteen  to  twenty-one  days. 
The  Argentine  Parliament  has  voted  a  law  authorising  the  Government  to  give 
a  subsidy  of  £400  monthly  to  any  company  adopting  the  refrigerator  system  and 
undertaking  to  make  the  voyage  to  Lisbon  or  Vigo  in  fifteen  days. 

f  The  population  of  the  United  States  is  hardly  yet  excessive  ;  the  country 
is  very  much  more  than  self-supporting,  and  many  States  and  Tcriitories  are 
sparsely  settled.  The  real  source  of  trouble  is  that  many  of  the  national 
resources  are  locked  up  in  the  hands  of  Trusts  or  private  owners;  and  the 
effect  of  railway  combinations  and  of  produce  trusts  all  over  the  country  is 
resulting  in  a  state  of  affairs  similar  to  that  produced  by  a  lack  of  communica- 
tions and  also  an  effect  similar  to  that  of  over-population.  It  is  obvious  that 
both  causes  make  for  emigration,  as  the  English  immigrant  in  Canada,  who 
finds  all  the  best  locations  occupied  by  Americans,  has  cause  to  know.  —  [Tranb  ] 


116    THE  ARGENTINE  IN  THE  20th  CENTURY 

that  they  are  striving,  by  all  the  means  in  their  power,  to 
restrain  the  stream  of  immigration  that  pours  upon  their 
shores. 

Australia,  which  was  also  only  recently  one  of  the  great 
centres  of  immigration,  has  during  these  last  few  years 
suffered  terrible  economic  shocks,  of  which  the  effect  has 
been  to  divert  the  stream  of  new  arrivals.*  Moreover  as  a 
rival  of  the  Argentine,  Australia  has  two  causes  of  inferiority  : 
her  rigorous  climate,  which  exposes  the  country  to  violent 
extremes  of  temperature,  passing  from  intolerable  heat  to 
a  bitter  cold,  and,  on  the  other  hand,  a  distance  from  the 
European  countries  to  which  she  exports  her  products 
double  that  between  the  banks  of  the  Plata  and  Europe. 

Having  thus  made  it  clear  that  the  Argentine  Republic 
IS  in  an  exceptional  position  to  attract  and  to  support  a 
large  European  population,  the  time  has  come  to  measure 
the  distance  travelled,  and  to  note  the  progress  realised,  so 
that  we  may  see  whether  the  results  obtained  are  in  pro- 
portion to  the  perfect  adaptation  of  the  soil  to  immigration. 

Without  being  too  pessimistic,  we  are  forced  to  recognise 
that  all  efforts  hitherto  made  by  the  Argentine  to  increase 
its  population  have  hitherto  remained  without  appreciable 
effect,  t 

ir  Colonisation,  that  is,  the  peopling  of  the  country,  was 
inaugurated  in  the  Argentine  by  the  initiator  of  all  tme 
progress  — Rivadavia  — who  founded  the  first  colony"^ 
Santa  Catalina.  This  work  was  intelligently  and  en- 
thusiastically continued  by  Mitre  and  Rawson,  in  1863T"it 
was  then  vigorously  pushed  by  Sarmiento  during"  hi~s 
extremely  progressive  administration;  but  as  a  matter_5 
fact,  in  spite  of  all  these  efforts,  colonisation  has  not  given 

*  Here  again  the  trouble  is  partly  due  to  the  back-blocks  being  taken  up  by 
large  settlers,  and  still  insufficient  means  of  transit.— [Trans.] 

t  It  is  one  of  the  disadvantages  of  immigration  from  a  very  poor  country  where 
there  is  no  political  oppression,  that  immigrants  will  return  to  it,  after  saving 
money  in  a  country  where  money  is  cheap  and  the  standard  of  living  higher,  as 
the  work  of  a  few  years  will  establish  them  comfortably  in  their  native  country 
This  is  especially  true  of  Italian  emigrants.     The  evil  will  doubtless  be 


over- 


come  by  a  measure  comparable  to  the  "Homestead  Act"  of  the  United 
States,  in  conjunction  with  national  loans  of  capital  or  of  farms  as  going 
concerns,  to  be  bought  by  payment  at  a  low  interest,  which  would  result  in  a 
population  of  peasant  owners  in  comfortable  circumstances.— [Tkans  ] 


IMMIGRATION  AND  COLONISATION  117 

the  results  that  were  expected  of  it.  To  explain  this  lack 
oTsucces^,  we  must  suppose  that  the  work  has  not  been 
promoted  according  to  the  indications  of  science  and 
experience,  and  that  a  variety  of  events,  uncontrollable  by 
the  human  will,  has  thwarted  the  praiseworthy  intentions  of 
the  Government.  Otherwise  it  is  impossible  to  account  for 
the  fact  that  the  Republic  contains  less  than  6  million 
inhabitants,  whereas  its  soil  would  support  100  millions. 

To  attain  the  primordial  object  of  peopling  the  country, 
the  Argentine  has  had  at  its  disposal,  among  others,  one  very 
important  means — the  public  lands— a  means  which  other 
nations  in  similar  circumstances  have  employed  with  ex- 
cellent results,  but  which  in  this  case  has  unhappily  not 
produced  the  same  happy  effect,  being  manipulated  by 
inexperienced  or  thoughtless  hands, 

«  Various  laws  have  been  voted  in  the  Argentine,  tending 
to  augment  the  population  by  means  of  colonisation.  All 
systems  have  been  tried  successively,  and  one  and  all  have 
failed.  " This  f ailurej'  says  M,  Eleodore  Lobos,  in  an  extremely 
instructive  volume  published  under  the  modest  title,  "  Notes 
on  the  Land  Laws"  {Annotations  sur  la  legislation  des  terres), 
"  is  an  incontestable  fact,  and  must  be  attributed  not  only^to 
economic,  administrative,  and  political  conditions,  but  also 
to  the  freedom  with  which  the  soil  has  been  divided  into  lots 
01  enormous  area,  and  the  obstacles  opposed  to  the  easy  and 
secure  acquisition  of  small  properties.  In  other  terms,  our 
poTiticians  have  effected  the  very  reverse  of  a  rational 
colonisation,  and  have  established  a  system  of  large 
properties  instead  of  subdividing  the  land  between  the 
colonists  according  to  their  productive  capacities. 

This  error  was  recognised  by  the  Government  more  than 
fifteen  years  ago;  but  the  influence  of  speculators,  who  profit 
from  this  short-sighted  policy,  has  been  more  powerful  than 
all  attempts  at  reform. 

"  To  understand  the  matter,"  says  the  same  author,  "  we 
have  only  to  see  with  what  indifference  to  the  public  weal 
the  executive,  during  the  last  twenty-five  years,  has  disposed 
of  ~^,81T,000  acres  of  uncultivated  soil,  which  formed  part 
"koi  the  national  domain.  The  laws  voted  were  impotent  to 
prevent  the  disposal  of  these  public  lands  in  large  parcels, 


lis    THE  ARGENTINE  IN  THE  20th  CENTURY 

so    that    the    disposal   of    these    lands    failed    to    draw   the 
population  which  these  vast  domains  could  supjTort." 

The  real  beginning  of  Argentine  immigration  was  when 
the  tyranny  of  Rozas  was  overthrown  on  the  3rd  _o_f 
February,  1852_,and  a  regular  Government  established,  which 
voted  a  fiindamental  law  of  which  the  object  was  "to 
cherish  the  general  welfare,  and  to  secure  the  a<lvantages  of 
liberty  to  every  citizen,  to  posterity,  and  to  all  people  of 
the  earth  who  desire  to  live  on  Argentine  soil."  From  this 
moment  a  powerful  current  of  European  immigration  set  in ; 
turned  aside  from  time  to  time  by  tinancial  crises,  plagues,* 
and  war ;  but  never  completely  arrested.  Industry,  commerce, 
and  agriculture,  which  had  so  far  slumbered,  received  a  con- 
siderable stimulus  from  this  new  source.  In  a  single  year 
more  immigrants  entered  by  the  port  of  Buenos  Ayres  than 
had  for  many  years  entered  the  whole  country. 

The  public  administration  did  not  take  the  trouble  to 
keep  an  exact  record  of  the  number  of  immigrants  before 
the  year  1853;  and  between  1854  and  1870  we  have  simply 
the  number  of  new  arrivals,  without  any  further  details. 
Only  since  1870  have  the  official  statistics  classed  the 
immigrants  according  to  nationality,  and  only  since  1881 
have  they  recorded  other  details,  such  as  sex,  age,  profession, 
education,  etc. 

During  the  last  six  months  of  1854,  2524  persons  entered 
the  country;  in  1855,  5912;  in  185fi,  4672;  in  1857,  4951, 
in  1858,  4658;  and  in  1859,  4735;  or  27,452  in  six  years: 
that  is,  far  more  than  had  entered  during  two  centui-ies  of 
colonial  life. 

In  the  decade  formed  by  the  years  1860-1869,  the 
number  of  immigrants  increased  to  134,325;  in  the  yejirs 
..  1870-1879,  to  264,869;  but  the  highest  figures,  no  less  than 
/u'  1,020,907,  were "  reached  betwe-en  1880  and  1889.  But  we 
must  confess  that  during  this  decade  certain  artificial  means 
were  employed  to  recruit  the  popuhition  in  Europe;  sucli 
means  as  gratuitous  passages,  which  brought  to  the  Argentine 
a  number  of  useless  people,  unfitted  for  any  productive 
task  whatever. 

*  Tho  term  used,  flmu.r,  would  probably  include  yellow  fever,  drought, 
locusts,  cattle  disease,  bad  harvests,  etc.,  etc. — [Tkans.J 


IMMIGRATION  AND  COLONISATION  119 

Dui'ing  the  following  decade,  1890-1899,  which  saw  the 
terri51e  banking  smash  and  the  loss  of  public  credit,  as  a 
result  of  every  kind  of  excess,  the  immigration  diminished 
slightly — to  928,000  persons — and  at  certain  moments  emigra- 
tion also  made  itself  felt,  in  such  proportions  that  it  amounted 
to  a  veritable  exodus.  The  departure  of  those  who  failed 
to  make  money  in  the  Argentine  or  find  the  work  they 
sought  amounted  to  552,172,  the  largest  figures  that  have 
so  far  been  recorded. 

Unhappily  this  double  stream  of  immigration  and  emigra- 
tion has  continued  up  to  the  present.  Thus,  in  1900-1904, 
601,682  immigrants  entered  the  country;  but,  on  the  ether 
lianB,  o84,000  emigrants  left  it.  Such  figures  as  these 
denote  a  grave  disorder  in  the  assimilative  faculty  of  a 
nation.  Matters  were  no  better  in  the  three  years  1905-1907, 
since  although  781,796  immigrants  entered  from  P^urope 
and  from  Montevideo,  324,687  emigrants  left  during  the 
same  period,  leaving  a  total  of  only  457,108  in  three  years. 

In  the  previous  period,  from  1900-1904,  the  diminution 
of  the  current  of  immigration  was  explained  by  various 
causes:  in  the  first  place,  by  bad  harvests,  the  suspension 
oF  important  public  and  private  undertakings,  the  fear 'of 
war  over  the  frontier  question,  the  dearness  of  living,  the 
difficulties  experienced  by  the  immigrant  in  settling  in  the 
national  or  private  colonies:  the  excessive  price  of  land  and 
the  high  rents  in  the  more  promising  agricultural  districts, 
tKe  insecurity  of  life  for  man  and  beast,  the  abuses  of  the 
authorities,  especially  in  districts  remote  from  the  centres 
of  population,  and  the  tardy,  costly,  and  faulty  nature  of 
j^ustice. 

But  since  tliis  period  many  of  these  causes  have  dis- 
appeared, thanks  to  the  splendid  harvests  of  the  last  few 
years,  and  to  the  period  of  rai)id  economic  expansion  upon 
which  the  Republic  has  entered.  It  is  difficult,  under  these 
conditions,  to  explain  the  still  existing  lack  of  immigration, 
which  denotes  a  disorder  of  the  assimilative  faculties  of 
the  country, 

^  Among  the  causes  likely  to  prevent  immigration  there 
is  ofie  which  must  not  be  too  closely  insisted  upon:  the 
_iucreasing  cost  of  living.     But  it  is  tlie  European  mode  of 


120    THE  ARGENTINE  IN  THE  20th  CENTURY 

life  that  is  dear,  while  in  the  country  districts  existence 
costs  next  to  nothing,  as  the  colonist  himself  produces 
practically  every  alimentary  necessity. 

We  must  also  note  that  every  year  numbers  of  harvesters 
arrive  from  Europe,  earn  good  wages,  save  money,  and  return 
to  their  native  countries  directly  after  the  harvest. 

In  1905,  1906  and  1907  the  migratory  movement  was 
represented,  as  we  have  seen,  by  781,795  immigrants  and 
324,687  emigrants.  If  we  allow  that  each  of  these  latter 
took  away  with  him  a  sum  of  £80,  as  the  Department  of 
Immigration  has  calculated,  it  follows  that  from  this  cause 
alone  nearly  £10,000,000  left  the  country  during  this  period 
of  three  years. 

Here  are  some  figures  taken  from  an  official  publication 
dealing  with  the  migratory  movement,  which  relate  both 
to  immigration  and  emigration,  and  show  which  European 
countries  have  chiefly  contributed  to  the  current  of  immigra- 
tion. Italy  and  Spain,  as  will  be  seen,  furnish  the  greatest 
number  of  immigrants. 

iTnmigratioii  and  Emigration. 


Year. 

Immigrants. 

Emigrants. 

Excess  in  favour  of 

1904 

125,567 

38,923 

86,644 

1906 

177,117 

42.869 

134,248 

1906 

252,536 

60,124 

192,412 

1907 

209,103 

90,190 

118,913 

1908 

255,710 

85,412 

170,298 

Immigration  from 

1857  to  1908. 

Italians 

1,799,423 

Spaniards 

795,243 

French 

188,316 

English    . 

42,765 

AuBtro-Hungarians 

59,800 

Germans 





40,655 

Swiss 

.. 

28,344 

Belgians 

... 

20,668 

Other  Nationalities 

... 

203,242 

Total         3,178,456 

As  we  have  already  observed,  one  of  the  causes  which 
impede  emigration  is  to  be  found  in  the  faulty  distribution 
of  the  soil,  the  obstacles  which  the  agricultural  immigrant 


IMMIGRATION  AND  COLONISATION  121 

has  to  surmount  before  he  can  become  the  proprietor  of  even  -^=0^ 
a  scrap  of  ground  ;  and  in  the  lack  of  serious  attempts  at 
colonisation,  which   would  provide    the  cultivator  with  the 
means  of  working  his  holding  and  finally  of  becoming  its 
proprietor.     "How  many  immigrants,"   says    Senor   Girola, 
"coming  to  this  country  with  the  idea  of  buying  a  little  piece     ^y' 
of  land,  have  been  forced  to  abandon  their  dream,  on  account  "nJ 
of  the  diiJiculties  put  in  the  waj^  of  their  obtaining  the  desired 
holding !  "  * 

•  Far  from  encouraging  the  promotion  of  a  class  of  small 
land-owners,  the  State  has  assisted  in  the  establishment  of 
enormous  holdings,  which  are  the  chief  obstacle  to  the 
peopling  of  the  country.  In  place  of  dividing  into  small 
allotments,  accessible  to  modest  fortunes,  the  great  stretches 
of  land  near  the  railways  or  the  ports,  and  offering  them  . 
for  sale  at  low  prices  in  the  European  communities  from  =-=r 
which  a  number  of  immigrants  come  each  year,  as  is  done 
by  the  United  States,  Australia,  and  Canada,  the  Argentine 
administration  has  subjected  all  the  operations  of  purchase 
to  long  and  wearisome  formalities  which  quickly  exhaust 
both  the  savings  and  the  patience  of  the  purchaser. 

Argentina,  then,  if  she  wishes  to  solve  this  vital 
problem  of  colonisation,  which  is  for  her  the  problem  of 
immigration,  must  give  careful  thought  to  the  adoption  of 
some  well-devised  scheme,  with  the  object  of  subdividing 
the  present  great  parcels  of  land,  and  of  attaching  the 
agriculturalist  to  the  land  he  tills,  by  allowing  him  to  become 
its  owner.  Without  this  necessary  reform,  the  country  will 
continue  to  experience  the  phenomenon  of  temporary 
immigrati<m ;  the  immigration  of  men  who  return  to  their 
own  countries  as  soon  as  they  have  been  able  to  save  a  little 
money  :  a  process  exceedingly  prejudicial  to  the  best  interests 
of  the  country. 

*  Investiyacion  agricola,  1904,  Carlos  D.  Girola. 


PART  II 

THE  ARGENTINE  AS  AN  AGRICULTURAL 
COUNTRY 


CHAPTER   1 

AGRiCULTUKE 

Natubal  Conditions — The  Constitution  of  Property — The  three  principal 
agricultural  districts — The  northern,  central,  and  southern  districts — The 
division  of  crops  and  thoir  varieties. 

The  constitution  of  rural  property— The  division  of  property — The  great 
estates,  called  "estancias,"  and  their  dimenBious. 

The  drawbacks  of  largo  properties — The  necessity  of  a  better  subdivision  of 
the  public  lands — The  division  into  lots  of  large  tracts  of  land,  in  order  to 
encourage  colonisation— The  system  of  exploiting  property. 

Agbicultural  Production — Progress  realised  in  the  last  seventeen  years- 
Comparative  yield  of  the  chief  products,  wheat,  flax,  and  maize — Lucerne  ; 
the  importance  of  the  crop  and  the  excellent  results  obtained. 

Increase  of  the  area  under  seed — The  total  area  cultivated  in  the  agricultural 
years  1908-1909— The  great  agricultural  belts. 

The  Province  of  Buenos  Ayres,  its  agricultural  development  and  its  crops — The 
Province  of  Santa  Fe — The  Province  of  Cordoba — The  Territory  of  the 
Pampa  Central. 

Agricultural  machinery,  its  importation  from  abroad,  and  especially  from  the 
United  States. 

Thk  Agricultural  Yield — The  yield  of  the  soil  in  the  different  Provinces — 
Exceptional  results  in  certain  districts— Detailed  calculation  of  the  yield 
of  a  wheat  farm — Two  instances  of  great  wealth  realised  by  immigrants 
into  the  Argentine. 

Natural  Conditions — The  Constitution  of  Property. 

THE  Argentine  Republic,  which  we  are  now  about  to 
consider  from  the  geological  and  hydrographical  point 
of  view,  ofiers,  by  the  mere  fact  of  its  physical  constitution, 
an  immense  future  for  agriculture  on  the  largest  possible 
scale,  and  at  the  same  time  for  stock-raising  and  the  rural 
industries. 

We  find  that  the  country  contains  three  principal  agri- 
cultural regions  :  (1)  the  region  to  the  north  of  the  provinces 
of  Santa  Fe  and  Entre  Rios ;  (2)  the  central  region  which 
runs  southward  from  the  limits  of  the  northern,  as  far  as 
the  south  of  the  Province  of  Buenos  Ayres  and  the  Territory 
of  La  Pampa,  including  a  portion  of  the  Territories  of  Rio 
Negro  and    Neuquen ;  (.i)  the   southern  region,   which  runs 

1  125 


126    THE  ARGENTINE  IN  THE  20th  CENTURY 

southward  from  the  limits  of  the  central  region,  down  to 
Tierra  del  Fuego. 

The  first  region  is  characterised  by  a  hot  climate,  with 
regular  rains  in  the  eastern  parts ;  in  the  west  the  rainfall 
is  leas  frequent.  The  central  region  enjoys  a  temperate 
climate ;  there,  as  in  the  northern  region,  the  rains  are 
regularly  distributed  in  the  eastern  parts,  but  are  very 
rare  in  the  west,  which  is  subject  to  long  periods  of  drought. 
In  the  southern  region  the  rains  are  less  frequent  and  the 
climate  is  more  severe,  with  the  exception  of  the  west  and 
the  extreme  south,  which  are  also  in  a  rainy  belt. 

After  long  experience  a  kind  of  natural  selection  has 
come  into  operation  with  regard  to  agriculture  ;  the  various 
crops  are  to-day  distributed  nearly  as  follows  :  Cereals,  such 
as  wheat,  barley,  oats,  maize,  and  millet,*  are  cultivated  more 
especially  in  the  region  formed  by  the  Provinces  of  Buenos 
Ayres,  Santa  Fe,  Entre  Rios,  CcSrdoba,  and  the  Territor^;_of 
the  Pampa,  which  latter  is  par  excellence  the  cereal-growing 
district.  Maize,  however,  is  grown  over  a  still  wider  region ; 
it  is  cultivated  with  success  in  the  whole  of  the  central  and 
northern  regions  of  the  Republic.  Rice  can  also  be  grown 
in  these  regions ;  its  culture  is  being  developed  in  ^e 
Provinces  of  Tucuman,  San  Juan,  Mendoza,  Salta,  La  Rioja, 
and  Jujuy,  and  also  in  Corrientes,  Formosa,  Chaco  and 
Misiones.  The  Provinces  of  Santa  Fe,  Entre  Rios,  and 
Buenos  Ayres  are  also  capable  of  producing  rice.t 

Oleaginous  plants,  such  as  the  castor-oil  plant,  sesame, 
and  the  poppy,  find  favourable  conditions  of  growth  in  the 
north,  while  linseed, t  colza,  and  rape  prosper  in  the  cereal 
districts. 

The  sugar-cane  is  cultivated  in  the  northern  region,  but 

*  Millet  is  an  article  of  diet  among  the  Latins  of  Southern  Europe.  The 
ordinary  "minestra"  or  soup  of  the  Italian  wayside  albergo  consists,  to  English 
eyes,  of  a  pint  of  hot  water  poured  over  a  cup  of  bird-seed.  Pounded,  it  makes 
a  kind  of  cake  or  bread ;  when  boiled  it  swells  slightly  and  is  partly  digested. 
—[Trans.] 

t  Invcstigaci6n  agricola,  by  Carlos  D.  Girola,  1904. 

X  It  should  perhaps  be  stated  that  the  flux  or  linen  plant  (Fr.  Un)  so  often 
mentioned  in  this  book,  produces  not  only  the  flax  or  linen  fibre  of  commerce, 
but  also  linseed,  with  its  valuable  products,  oil-cake  and  linseed-oil ;  the  first 
used  for  fattening  cattle,  the  second  for  paints,  varnishes,  oilskins,  and  "  inlaid 
linoleums,"  as  well  aa  the  basis  or  "  ski'im  "  of  ordinary  oilcloth. — [Tbans.] 


AGRICULTURE  127 

especially  in  Tucuman,  in  part  of  Santiago  de  I'Estero,  Salta, 
Jujuy,  and  Corrientes,  and  in  the  north  oi"  Santa  Fe,  Formosa, 
Chaco  and  Misiones. 

The  vine  is  cultivated  chietly  in  Mendoza  and  San  Juan, 
where  the  conditions  of  soil  and  climate  are  favourable,  and 
wliere  it  is  methodically  irrigated  by  the  canals  v^hich  water 
the  whole  of  the  vine-growing  districts  ;  but  the  wine  and  the 
dessert  grape  can  be  grown  in  the  whole  of  the  central  region. 
It  also  prospers  in  La  Rioja,  Catamarca,  Salta,  and  Entre  Rios. 

Stock-raising  is  followed  especially  in  the  Provinces  of 
Buenos  Ayres,  Santa  Fe,  and  Entre  Rios^  and  in  the  south 
of  the  Province  of  Cordoba;  and  in  a  great  part  of  the 
Pampa  Central. 

"  The  principal  characteristics  of  Argentine  agriculture 
having  been  considered,  we  must  now  inquire  how  rural 
property  is  constituted  ;  that  is,  among  how  many  proprietors 
or  tenants  the  35,000,000  acres  under  cultivation  at  the  end 
of  1908  are  shared. 

In  the  United  States,  for  example,  we  know  by  the  census 
of  1900  that  the  840,000,000  acres  given  over  to  agriculture 
are  divided  into  5,739,657  distinct  holdings,  giving  an  average 
of  about  142  acres  per  holding.  In  France,  according  to 
the  statistics  for  1892,  11,250,000  acres  were  divided  into 
5,702,000  holdings,  the  average  extent  being  about  21  acres. 

Is  it  possible  to  obtain  similar  figures  for  the  Argentine  ? 
The  national  census  of  1895  gives  us  certain  data  respecting 
the  division  of  rural  property  in  this  country.  The  172,000 
holdings,  agricultural  or  pastoral,  which  were  included  in 
this  census,  had  an  area  of  20,295,000  acres,  according  to 
the  declarations  of  the  owners ;  and  comparing  this  figure 
with  the  area  actually  under  cultivation,  amounting  to 
12,800,000  acres,  we  find  that  only  about  the  half  of  these 
holdings  is  tilled  and  sown,  the  rest  being  left  as  pasture. 

This  census  also  took  note  of  the  area  of  each  agricultural 
holding,  and  although  the  result  of  this  inquiry  has  not  been 
published,  a  simple  division  of  the  number  of  acres  by  that 
of  the  holdings  gives  us  an  average  of  118  to  123  acres  per 
h^olding ;  a  figure  that  would  be  satisfactory  enough,  if  it 
came  anywhere  near  the  reality,* 

*  Cy.  Censo  Nacional,  vol.  ii.  p.  xli. 


128    THE  ARGENTINE  IN  THE  20th  CENTURY 

The  national  inventory  giv^es  (mly  these  data  in  respect 
of  this  subject.  As  we  see,  they  are  far  from  complete ;  but 
even  if  they  were,  the  progress  of  agriculture  during  the  last 
few  years  has  been  so  great  that  to-day  they  would  only 
possess  a  purely  historical  interest. 

Happily  the  agricultural  census  (including  a  census  of 
stock),  which  was  taken  during  the  first  half  of  May  1908 
throughout  the  whole  Republic,  gives  us  some  valuable 
information  on  this  head. 

This  inquiry  affected  222,174  holdings,  agricultural  or 
pastoral,  which  had  a  total  area  of  450,000  square  miles,  the 
area  of  the  Republic  being  1,134,700  square  miles.  This  is 
how  these  222,174  holdings  are  divided : — 

There  are  53,954  holdings  measuring  from  27"2  to  ]23'4 
acres ;  48,323  of  less  than  25  acres ;  46,553  of  from  250  to 
740  acres  ;  29,624  of  from  125  to  247  acres  ;  12,992  of  from 
743-5  to  1234  acres;  11,104  of  from  1236  to  2470  acres; 
2968  of  from  2970  to  9260  acres;  2052  of  from  9260  to 
12,350  acres;  1157  of  from  12,350  to  24,680  acres.  Holdings 
of  more  than  24,680  acres  are  relatively  rare,  in  comparison 
with  the  rest;  423  have  an  area  of  from  24,680  to  30.870 
acres ;  781  of  from  30,870  to  61,750  acres";  rB8  of  from 
61,750  to  114,250  acres ;  65  of  from  114,250  to  123,440  acres, 
and  finally  there  are  104  holdings  of  more  than  123,440  acrfis. 

These  figures,  compared  with  those  of  the  census  of  1895,  , 
reveal  the  fact  that  in  thirteen  years  the  number  of  rural 
holdings  has   increased  by  50,174,  and   that  the  area  given 
over  to  the  two  forms  of  usage,  which  lie  at  the  base  of  the 
wealth  of  the  Republic,  has  increased  by  276,760,000  acres. 

But  in  spite  of  this  extraordinary  development  during 
the  last  few  years,  from  the  point  of  view  of  the  distribution 
■^  of  the  soil,  the  Argentine  is  still  in  a  primitive,  indeed,  almost 
in  a  feudal  state,  by  reason  of  the  enormous  tracts  of  lands 
which  are  monopolised  by  a  small  number  of  owners.  These 
owners  utilise  their  enormous  properties  in  raising  cattle  on 
the  great  ranches  known  as  "  estancias,"  or  employ  them  iov 
agricultural  purposes,  when  they  do  not  prefer  to  leave  them 
in  a  waste  and  unproductive  condition,  waiting  until  time 
and  economic  progress  shall  give  them  a  value  which  the'r 
own  efforts  are  incapable  of  giving  them. 


AGRICULTURE  129 

These  "estancias" — that  is  to  say,  tlie  most  usual  system 
of  utilisinc^  the  soil — vary  in  area  from  12,000  to  180,000  or 
200,000  acres;  some  are  even  over  830,000  acres  in  extent. 
Many  of  them  are  only  a  few  hours  distant  fi'om  the  city  of 
IJuonos  Ayres,  or  border  on  the  outskirts  of  important  urban 
centres. 

Such  tracts  of  land  given  over  to  stock-raising  and 
owned  by  private  individuals  would  be  inconceivable  in 
most  European  countries,  where  private  holdings  are  small ; 
nor  are  Ihey  much  more  usual  in  a  new  country  of  vast  area, 
like  the  United  States,  where  more  than  half  the  cultivated 
lands  arc  divided  into  farms  of  less  than  100  acres  each,  and 
where  holdings  of  more  than  1000  acres,  whether  under  seed 
or  in  pasture,  are  the  exception,  the  average  of  all  properties 
and  holdings  being  143  acres. 

It  is  easy  to  understand,  without  a  lengthy  demonstra- 
tioujliow  far  this  state  of  affairs  goes  to  retard  the  general 
development  of  the  country.  It  is  equally  easy  to  under- 
stand that  in  order  to  stimulate  this  development  it  is 
necessar}^  before  all  else  to  secure  an  increased  foreign  popu- 
lation, by  attracting  it  through  the  powerful  bait  of  landed 
property. 

•  ">f  The  great  obstacle  in  the  way  of  the  agricultural  develop- 
ment, of  the  Argentine  arises  essentially  from  the  faulty 
property  system;  from  the  fact  that  enormous  tracts  of 
land  are  held  by  a  few  men  ;  from  the  establishment,  in 
sRort,  of  the  most  odious  system  of  lafifundia  ever  known. 
TEis  trouble  arises  from  the  lack  of  foresight  with  which 
tte  State  has  parted  with  enormous  tracts  of  land,  which 
have  passed  into  the  hands  of  speculators  or  large  land-owners, 
who  have  left  them  untouched,  while  waiting  for  the  value 
of  their  holdings  to  rise. 

In  the  national  territories,  according  to  the  deputy 
Joachim  Castellanos,  who  is  busily  fighting  the  system  of 
latifundia,  there  are  belts  of  land,  now  private  property, 
which  are  divided  in  the  following  proportions :  2,470,000 
acres  into  holdings  of  from  25  to  99,000  acres  each  ;  7,400,000 
acres  into  holdings  of  from  99,000  to  198,000  acres  each  ;  and 
7,934,000  acres  into  properties  of  190,000  or  200,000,  and 
over.     This  means  that  there  are  17,280,000  acres  of  useful 


130    THE  ARGENTINE  IN  THE  20th  CENTURY 

and  cultivable  laud,  in  the  hands  of  unenterprising  capita- 
Tists  remaining,  unproductive,  used  to  increase  neither  ^tbe 
population  nor  the  production  of  the  country.* 

The  principal  author  of  this  deep-rooted  evil  is  incon- 
testahly  the  Argentine  State,  which  has  squandered  its  rich 
inheritance,  by  allowing  it  to  pass  into  the  hands  of  specu- 
lators, instead  of  dividing  it  equitably  among  the  new 
colonists.  The  subdivision  of  these  great  tracts  of  land, 
now  concentrated  in  the  hands  of  a  few  large  proprietors, 
is,  to-day,  one  of  the  necessary  conditions  of  the  develop- 
ment of  the  country,  and  it  is  with  reason  that  influential 
voices  are  raising  themselves,  in  Parliament  and  in  the  Press, 
to  proclaim  this  economic  truth. 

The  great  "estancias"  of  ISO  square  miles  in  area,  covered 
by  immense  herds  of  cattle,  must  finally,  says  M.  F.  Segni, 
author  of  an  Investigacion  agricola,  be  divided  into  small 
concerns  of  from  4000  to  12,000  acres,  which  would,  wT^ 
fewer  animals  but  a  better  system,  yield  a  greater  profit  both 
to  the  owner  and  to  the  country.  The  old  system  of  large 
ranchir)g  must  gradually  give  way  to  an  intensive  system, 
when  stock-raising,  combined  with  agriculture,  will  employ 
a  larger  population,  attract  more  capital,  and  realise  better 
results. 

There  is  happily  no  need  to  be  greatly  pessimistic  on  this 
point,  as  we  can  already  perceive  a  tendency  to  the  sub- 
division of  property,  which  comes  from  the  powers  of  the 
State  as  well  as  from  land-owners  or  commercial  companies. 
Thus  the  land  law  of  1907  was  passed  solely  with  the  object 
of  preventing  large  monopolies ;  it  prohibits  the  acquisition 
for  the  benefit  of  a  single  person  of  any  portion  of  the 
national  domains  of  greater  area  than  6170  acres.  The 
importance  of  this  step  will  be  understood,  when  we  re- 
member that  the  State  has  still  to  dispose  of  212  millioas 
of  acres  of  desert  land,  suitable  for  agriculture,  and  situated 
in  territories  which  are  rapidly  becoming  peopled. 

On  the  other  hand,  there  are  certain  business  concerns 
which,  as  owners  of  enormous  tracts  of  land,  are  dividing 
them  into  small  lots,  which  they  are  oflfering  freehold  to 
prospective  farmers  at  fairly  moderate  prices,  and  facilities 

*  Speech  delivered  on  21st  September  1903. 


AGRICULTURE  131 

of  payment  are  offered  at  the  same  time.  Among  these  firms 
we^  may  mention  the  "  Sociedad  Anonima  la  (^urumalaa," 
owning  some  600,000  acres  of  land  in  the  southern  portion 
of  the  Province  of  Buenos  Ayres,  suitable  both  for  cattle- 
raising  and  for  agriculture,  which  is  selling  land  at  from 
£2,  2s.  to  £3  per  acre,  according  to  the  quality  and  the 
situation,  payable  in  three  or  four  years ;  the  payment  by 
instalments  being  increased  by  an  interest  varying  from 
7  to  9  percent,  yearly.  The  "  Stroeder  Colonisation  Society," 
which  has  exploited  a  large  belt  of  agricultural  country ; 
the  "Compania  de  Colonisation  del  Rio  de  la  Plata;"  the 
"  Estancia  y  Colonia  Trenel,"  founded  by  the  great  Argentine 
land-owner,  Antonio  Devoto,  and  a  large  number  of  other 
companies  and  syndicates  are  working  on  the  basis  of 
enabling  the  colonist  to  acquire  his  own  laud,  and  are  doing 
successful  business. 

i^  A  striking  example  of  progress  in  this  matter  of  the 
subJTvisioii  of  property  is  furnished  by  the  statistics  of 
tl^  Province  of  Cordoba  for  the  years  between  1898-1899 
and  1905-1906.  During  this  period  3,193,600  acres  of  land^' 
out  of  a  total  of  9,823,300  acres,  which  represent  the  colonies 
and  settled  land  of  the  province,  have  been  sold  to  farmers  ; 
that  iSj_  nearly  a  third.  Thanks  to  this  subdivision,  the 
number  of  colonists  in  this  province  who  have  become  the 
acTualproprietors  of  larger  or  smaller  holdings  has  risen  to 
4568.  What  is  happening  in  Cdrdoba  is  also  happening 
more  or  less  rapidly  in  the  other  agricultural  provinces;  and 
it  is  l)y  this  method  that  the  Argentine  will  one  day  succeed 
in  abolishing  the  latifundia,  whose  progressive  disappear- 
ance is  a  condition  of  further  development. 

We  might  multiply  the  instances  of  land-owners  or 
commercial  enterprises  which  are  helping  the  labourer  to 
buy  land,  for  the  system  of  dividing  the  land  into  small 
allotments,  selling  it  at  a  cheap  price,  and  allowing  payment 
by  instalments,  is  every  day  becoming  more  widespread. 
The  journals  are  full  of  announcements  of  the  sale  by 
auction  of  lands  which,  until  to-day,  have  never  felt  the 
ploughshare,  and  are  now  given  over  to  colonisation.  One 
a^so  hears  men  speak,  as  of  an  accomplished  fact,  of  the 
method  initiated  by  several  railwaj^-companies  which  propose, 


132    THE  ARGENTINE  IN  THE  20th  CENTURY 

by  means  of  their  own  capital,  to  bring  into  the  market  and 
increase  the  value  of  the  vast  tracts  of  uncultivated  land 
which  they  own  on  the  outskirts  of  their  systems. 
jA-  Unhappily,  in  spite  of  this  tendency  to  the  subdivision  of 
the  soil,  the  most  usual  system  of  working  the  land  is  still 
that  of  letting  it  at  a  fixed  rent,  or  for  a  certain  proportion 
of  the  yield  in  place  of  rent,  or  by  a  profit-sharing  system, 
lihder  which  the  tenant  receives  50,  40,  or  30  per  cent._  of  the 
harvest.  The  large  land-owners,  who  are  the  most  numerous, 
prefer  the  former  method,  and  often  impose  on  the  farmer 
the  obligation  of  leaving  a  crop  of  lucerne  on  the  landjn 
the  last  year  of  the  tenancy. 

The  chief  drawback  of  this  system  is  that  the  labourer 
never  becomes  the  owner  of  the  soil  he  cultivates,  so  that 
he  is  not  actuated  by  the  powerful  ties  of  property,  which 
"should  attach  him  to  the  country  and  its  destinies.  On  the 
other  hand,  too,  the  tenant  tries  to  obtain  from  the  soil  the 
largest  profit  he  can,  without  troubling  to  consider  whether 
he  is  exhausting  it  or  not ;  he  leaves  not  even  a  tree  behind 
him  as  a  monument  of  his  tenancy.  But  in  spite  of  all  these 
drawbacks  this  system  does  furnish  the  colonist  with  means 
to  buy  land  cheaply  later  on,  and  in  another  district.  Such 
is  the  history  of  many  farmers,  who  began  by  humbly 
labouring  under  the  conditions  above  described,  and  are  to-day 
rich  land-owners,  possessing  enormous  tracts  of  land,  which 
they  work  in  the  way  that  they  find  most  profitable. 

It  is  hardly  necessary  to  say  that  the  agricultural  methods 
employed  vary  according  to  the  situation  of  the  farms,  their 
fertility,  and  the  means  of  communication.  Agriculture, 
properly  so  called,  establishes  itself  and  spreads  along  th^ 
waterways  or  railways  which  facilitate  the  transport  of 
the  harvests.  The  crops  principally  grown  cannot  afford 
the  cost  of  transport  at  a  greater  distance  than  180  or 
190  miles  by  railway  from  the  nearest  point  of  embarkation 
or  consumption,  and  the  nearest  railway-station  must  not 
be  further  than  18  or  20  miles.  There  are  only  a  few  crops 
of  greater  value  that  can  be  profitably  grown  at  greater 
distances,  their  higher  prices  covering  the  increased  cost  of 
transport. 

The  region  consisting  of  the  Provinces  of  Buenos  Ayres, 


AGRICULTURE  133 

Santa  Fe,  Cdrdoba,  and  Entre  Rios,  which  is  the  richest  in 
cereals,  is  also  that  in  which  the  greatest  number  of  small 
farms  are  to  be  found.  The  statistics  for  1901-1902  show  that 
out  of  37,434  farms  13,150,  or  about  36  per  cent.,  were  worked 
byHiheir  owners  ;  18,819,  or  50  per  cent.,  by  tenants;  and  5465, 
or  14  per  cent.,  by  metayers — that  is,  tenants  who  give  up  from 
half  to  two-thirds  of  the  crops  to  the  owner  of  tlie  land.  Other 
more  recent  statistics,  relating  to  the  Province  of  Santa  F^, 
give  the  number  of  farmers  owning  their  land  at  the  time  of 
the  harvest  as  6747,  or  32  per  cent.,  and  the  number  of  tenants 
as  14,227,  or  68  per  cent. 

The  majority  of  the  farms,  especially  those  cultivated  by 
the  owners,  says  the  Jnvestigacidn  agricola,  have  an  area 
varying  from  60  to  250  acres.  Farms  held  on  lease  or  by 
payment  of  part  of  the  harvest  are  usually  larger,  especially 
in  the  former  case,  and  the  work  is  done  with  greater  ex- 
pedition, but  as  a  rule  less  perfectly  and  without  the  same 
stimulus.  Farms  varying  from  750  to  1500  acres  and  more 
which  employ  day-labourers  are  still  less  numerous,  since 
as  a  general  thing  nothing  is  gained  by  employing  them. 
On  the  other  hand,  however,  there  are  large  farms  whose 
owners  in  reality  only  supervise  matters  of  administration, 
and  which  are  divided  among  tenant-farmers  or  metayers, 
paying  so  much  per  cent,  of  the  harvest,  or  a  rent  in  kind, 
according  to  the  crops  anrl  the  conditions  agreed  upon.  In 
such  a  case  the  proprietor  or  colonist  is  not  actually  an 
agriculturalist,  but  a  business  man,  who  more  often  than 
not  has  not  sufficient  knowledge  to  assume  the  scientific  or 
even  the  rational  direction  of  the  operations  on  his  estate. 

— •        Agricultural  Products.       ">— — 

Having  considered  the  physical  conditions  of  the  Argentine 
soil,  the  regions  given  over  to  particular  forms  of  agriculture, 
and  the  disposition  of  rural  property,  the  moment  has  now 
come  to  consider  what  areas  are  at  present  respectively  pro- 
ducing crops  of  various  kinds  from  seed,  comparing  them 
not  only  with  the  area  of  each  province,  but  also  with  the 
statistics  of  previous  years.  In  making  this  inquiry,  we 
have  a  valuable   starting-point   in  the   CeriHO  agropecuario, 


134    THE  ARGENTINE  IN  THE  20th  CENTURY 

taken  in  the  month  of  October  1888  ;  the  first  serious  under- 
taking of  the  kind  ever  attempted  in  the  Republic  under 
competent  direction.* 

In  an  introductory  chapter  the  Director  of  this  census 
says :  "  It  is  only  eleven  years  since  the  products  of 
Argentine  agriculture  have  been  greater  than  the  country's 
needs.  For  example,  the  quantities  of  wheat  exported  before 
1878  were  so  small  as  to  be  negligible.  Now  we  see  that  in 
eleven  years  we  have  reached  a  point  at  which  we  export 
8,800,000  bushels  of  wheat  (1887),  255,000  bushels  of  flour 
(1888),  14,470,000  bushels  of  maize  (1887),  and  3,248,000 
bushels  of  linseed  (1887).  Those  who  will  look  into  these 
figures  will  perhaps  agree  that  they  represent  a  great  progress 
for  so  short  a  time." 

The  area  of  agricultural  land  in  cultivation,  according 
to  the  census  of  1888,  amounted  for  the  whole  Republic 
to  5,984,790  acres,  of  which  2,014,000  acres,  or  about  33  per 
cent,  were  under  wheat ;  1,979,830  acres,  or  33  per  cent.,  under 
maize;  963,320  acres,  or  16  per  cent.,  under  lucerne  ;  299,050 
acres,  or  5  per  cent.,  under  linseed;  71,420  acres,  or  1-2  per 
cent.,  under  barley;  97,660  acres,  or  '9  percent.,  under  vines; 
52,020  acres,  or  '8  per  cent.,  under  sugar-cane,  and  the  rest 
under  crops  of  no  great  importance. 

This  point  of  departure  being  established,  let  us  pass 
over  the  follies  of  and  the  damage  caused  by  the  frantic 
speculations  of  1888  and  1889,  as  well  as  the  financial 
failures  of  1890,  and  let  us  call  a  halt  at  the  year  1895, 
in  which  the  country,  still  under  the  eflPect  of  a  terrible 
catastrophe  only  lately  undergone,  had  recovered  itself  and 
resumed  work  with  a  fresh  ardour :  the  only  proper  remedy 
to  heal  its  wounds,  and  to  set  it  once  more  on  the  paths  of 
progress.  This  inventory  of  the  progress  realised  by  the 
Argentine  during  seven  years  of  misfortune  is  all  the  more 
interesting  in  that  the  second  national  census  was  taken  at 
this  time,  thus  precisely  marking  the  economic,  democratic, 
and  political  progress  of  the  country.  We  find  that  in  1895 — 
limiting    our    inquiry    to    the    four   principal    cultures — the  i 

*  Cf.  L" agriculture  et  Vdevage  dans  la  liipublique  Argentine,  d'apr^s  le  I 
rerensement  de  la  premiere  quinzaine  d'octobre  1SS8,  by  P.  Latzina,  printed  by  | 
P.  Mouillot,  Paris,  1889. 


AGRICULTURE  135 


progress 

realised 

(Uirino-      these 

seven     years 

was     as 

follows  :- 

- 

1888 

i8q5 

Increase  in 

Seven  Years. 

Products.        j^ 

cres  Cultiv.ited. 

Acres  Cult  iv.ateil. 

Absolute. 

Per  cent. 

Wheat  ... 

2,014,130 

5,062,717 

3,048,587 

151 

Linsetsd 

299,050 

946,690 

647,640 

219 

Maize    ... 

1,979,910 

3,073,130 

1,093,220 

55 

Lucerne 

963,300 

1,729,000 
10,811,537 

766,700 

79 

Totals 

5,256,390 

6.555,147 

105 

If  we  now  compare  the  figures  for  1895  with  those  for 
1902,  we  find  that  the  national  agricultural  expansion  has 
never  ceased  during  this  second  period  of  seven  years. 
During  this  period,  moreover,  an  important  change  occurred  ; 
one  which  encouraged  production  by  placing  exchange  upon 
a  solid  basis :  we  refer  to  the  law  of  monetary  conversion, 
which  gave  paper  a  fixed  value  and  abolished  the  discount 
which  had  hitherto  aftected  all  private  commercial  trans- 
actions. 

In  comparing  the  figures  of  the  years  1895  and  1902,  we 
find  that  the  progress  was  as  follows  : —  X,, 


Products. 


1895  igo2  Increase  in  Seven  Years. 

Acres  Cultivated.  Acres  Cultivated.  Absolute.                   Per  cent. 

Wheat  ...         5,062,717  9,124,449  4,061,732                      80 

Linseed                946,690  3,228,774  2,282,084                     238 

Maize     ...        3,073,130  4,450,060  1,376,930                       44 

Lucerne             1,729,000  4,273,502  2,544,502                     147 


Totals         10,811,537  21,076,785  10,265,248  94 

It  now  remains  to   examine  the  third  period,  from  1902 
to  1904-1905,  the  statistics  of  which  are  as  follows: — 


Increase  in  Two  Years. 
Absolute.  Per  cer 


Products. 

Wheat  ...  9,124,449  12,110,706  2,986,257  33 

Linseed  ...  3,228.774  2,674,738  554,086  18 

Maize  ...  4,450,060  5,648,988  1,198,928  27 

Lucerne  ...  4,273,502  4,910,000  666,498  15 

Totals    ...        21,076,785  25,374,432  4,297,647  21* 

We  see  that,  with  the  exception  of  linseed,  the  progress 
of  agriculture  has  received  no  check  ;  on  the  contrary,  the 

*  This  increase  would  amount  to  73  "5  per  cent,  in  seven  years,  as  compared 
with  94  and  105  per  cent,  for  the  two  previous  periods  :  but  an  average  reckoned 
from  two  years  is  of  course  not  reliable.  —  [Trans.] 


136    THE  ARGENTINE  IN  THE  20th  CENTURY 

figures  speak  of  still  greater  expansion,  attesting  to  the 
great  economic  future  of  the  country. 

The  culture  of  wheat,  as  we  see,  has  increased  by 
2,986,257  acres;  maize,  by  1,198,928  acres;  lucerne,  by 
666,498  acres.  Unfortunately,  the  culture  of  linseed  has 
suffered  a  decrease  of  554,036  acres  ;  a  result  to  be  attributed 
partly  to  low  prices,  and  to  the  loss  of  a  certain  proportion 
of  the  previous  crops. 

As  for  maize,  we  see  that  in  1904-1905  5,648,988  acres 
were  sown,  a  figure  which  represents  an  increase  of  27  per  cent, 
over  the  4,450,060  acres  of  1902.  Yet  the  yield  was  only 
131,155,000  bushels  in  1904-1905,  whereas  in  1903-1904  it 
was  163,300,000  bushels.  This  sensible  decrease  was  felt 
chiefly  in  the  Province  of  Buenos  Ayres,  where  the  loss  was 
one  of  31,490,000  bushels,  out  of  the  total  loss  of  32,145,000 
bushels,  while  in  the  Province  of  Santa  Fe  the  yield  was 
almost  unaltered. 

The  average  yield  in  1904-1905  for  the  whole  country 
and  the  entire  area  of  land  under  seed  may  be  estimated  as 
23  bushels  per  acre,  as  against  31 '4  bushels  in  1903-1904, 
The  harvest  of  1904-1905  would  thus  have  left  a  large 
deficit,  had  not  the  increase  of  sown  lands  compensated  in 
part  the  diminished  yield  of  the  soil  per  acre.  This  fact 
is  a  witness  to  the  truth  of  the  important  fact  to  which  we 
have  elsewhere  drawn  attention:  that  the  Argentine  need 
no  longer  as  before  fear  a  bad  total  harvest,  by  reason  of 
the  enormous  increase  of  sown  lands.* 

Since  1905  the  agricultural  expansion  of  the  Republic 
has  assumed  considerable  proportions,  thanks  to  the  splendid 
harvests,  which  have  not  only  attracted  a  greater  number 
of  cultivators,  but  have  also  enabled  these  already  established 
to  tiike  in  and  cultivate  new  land. 

Examining  only  the  figures  relating  to  the  harvest  of 
1908-1909,  we  find  that  the  area  sown  in  wheat,  linseed,  and 
oats  has  increased  to  20,342,920  acres,  which  are  divided, 
according  to  the  figures  issued  by  the  Statistical  Division 

*  Years  hence,  whon  the  limit  of  expansion  has  been  reached,  or  expansion 
for  any  cause  has  diminished,  the  inevitable  exhaustion  of  the  soil  may  cause 
some  bad  years,  iinless  more  scientific  methods  take  the  place  of  the  policy  of 
obtaining  large  yields  at  any  cost;  but  the  change  will  probably  be  gradual. 
Trans— [.] 


AGRICULTURE  137 

of  Rural    Economy  of  the  Ministry  of   Agriculture,  in  tlic 
following  proportions : — 


Acres  under 

AcreR  under 

AcreH  under 

Provinces. 

Wheat. 

Linseed. 

Oals. 

Buenos  Ayros 

6,184,139 

1,05)0,750 

1,431,839 

Santa  Fe          

3,210,050 

1,631,188 

34,539 

Cordoba           

.n,711,9:^0 

421,870 

10,068 

Entro  Hios      ... 

793,610 

565,630 

37,050 

Pampa  Ccntralo 

780,400 

74,100 

49,400 

Other  Provinces 

185,250 

6,370 

1,235 

and  Territories 

Total 14,865,379  4,489,908  1,564,151 

If  we  add  to  these  figures  the  7,042,710  acres  sown  with 
maize  in  1906-1907,  and  the  7,410,000  acres  of  lucerne  which 
were  already  in  cultivation,  we  obtain  a  general  total  of 
more  than  35  millions  of  acres  of  land  bearing  the  principal 
Argentine  crops  at  the  end  of  1908. 

These  figures  reveal  the  large  increase  of  10  millions  of 
acres  over  these  relating  to  the  harvest  of  1904-1905. 

In  speaking  of  the  chief  crops  of  Argentine  agriculture, 
there  is  one  which  we  must  especially  mention,  which, 
although  not  capable  of  repetition  year  by  year,  yet  assumes 
considerable  proportions,  occupying  already  many  millions 
of  acres.  We  refer  to  the  fodder  known  as  lucerne,  which 
in  1890  was  grown  only  on  1,480,000  acres,  and  on  1,729,000 
in  1895  ;  while  to-day  no  less  than  7,412,000  acres  are  under 
lucerne. 

This  crop  is  a  new  source  of  wealth  for  the  Argentine. 
Its  growth  has  arisen  from  the  increased  value  of  lands 
which  were  until  lately  considered  unfit  for  the  production 
of  cereals.  These  lands  are  now  greatly  in  demand,  and  of 
late  years  great  fortunes  have  been  made  out  of  them. 

Lucerne  serves  two  different  purposes ;  it  is  exported  as 
dried  fodder,  or  is  used  at  home  to  feed  and  fatten  cattle. 
Hence  the  lucerne  farmer  may  either  graze  his  holding  or 
mow  it ;  so  that  there  are  lucerne  farms  and  lucerne 
"  estancias,"  or  ranches,  each  having  its  distinct  character- 
istics.* 

The  farms  are  mostly  near  the  stations  of  the  chief 
railway-lines  which  lead  to  the  ports  of  embarkation,  and 
consist  of  holdings  of  150  to  250  acres,  cultivated  by  small 

*   Lucerne  in  exported  chietly  to  Brazil  and  South  Africa. 


138    THE  ARGENTINE  IN  THE  20th  CENTURY 

proprietors,  or  more  generally  by  m6tayers — tenants  who 
pay  in  kind.  The  mowing,  drying,  raking,  gathering  and 
stacking  of  the  lucerne  are  operations  which  last  from  i 
October  to  March  ;  the  embalement,  or  packing  into  bales, 
which  are  pressed  and  bound  with  iron,  by  means  of  a  press 
worked  by  horse-power,  occupies  the  rest  of  the  year. 
There  is  also  a  form  of  exploitation  which  is  more  elementary 
and  also  more  rapid  :  the  cutting  and  immediate  sale  of  the 
crop  as  green  fodder  ;  this  method  is  in  use  on  farms  near 
the  cities. 

But  the  great  lucerne  belt,  which  occupies  by  far  the 
greatest  proportion  of  the  sown  lands,  is  composed  of  the 
"  estancias  ",  which  are  composed  of  fields  or  farms  of  lucerne 
destined  for  the  feeding  and  fattening  of  animals,  chiefly 
cattle.  These  exist  of  all  sizes ;  from  the  "  estanzula  "  to  the 
largest  ranches.  Latifundia  sown  with  lucerne  are  common 
in  the  south  of  Cordoba,  and  there  are  inatances  of  immense 
green  savannas  of  from  35,000  to  50,000  acres — roughly, 
from  50  to  80  square  miles  in  extent — consisting  entirely, 
of  lucerne  farms  and  belonging  to  a  single  lord  and  master.. 
There  are  several  settlements  or  colonies  of  this  kind  in  this 
region;  such  as  the  Colonia  Maria  Soledad,  situated  at 
Carnerillo  and  at  Chucul,  including  some  42,000  acres  of 
lucerne  farms;  and  the  Duggan  prairie,  which  has  32,000 
acres  of  lucerne.     Properties  of  15,000  acres  are  numerous. 

According  to  the  last  statistics  published,  the  culture  of 
lucerne  is  distributed  as  follows :  Province  of  Buenos  Ayres, 
1,235,000  acres;  Province  of  C6rdoba,  1,235,000;  Province 
of  Santa  F^,  740,000;  Pampa  Central,  300,000;  Province  of 
San  Juan,  200,000  ;  other  Provinces,  250,000 ;  giving  a  total 
of  some  4,000,000  acres.  At  the  moment  of  writing  these 
lines  this  area  should  certainly  have  increased  to  a  total 
of  7^  millions  of  acres. 

In  spite  of  the  great  progress  already  achieved — it  was  not 
less  than  25  per  cent.,  for  instance,  in  the  Province  of  C(5rdoba 
in  1903-04 — the  culture  of  this  species  of  forage  is  still  in  its 
infancy  in  the  Argentine ;  it  is  bound  to  increase  notably, 
on  account  of  the  superb  results  to  be  obtained,  both  from 
its  use  as  fodder  and  on  account  of  the  manner  in  which  it 
will  transform   a   certain   kind   of   uncultivated  soil  which 


AGRICULTURE  139 


grows  nothing  but   tough   grasses  of  slow  growth  uiid  low 
nutritive  value. 

One  of  the  first  economic  effects  produced  by  the  growth 

of  lucerne  on  a  particular  estate  or  in  a  given  neighbourhood 

5  i  i8  that  it  increases  the  value  of  the  land  on  which  it  has 

I  been  sown.  On  this  point  several  cases  have  been  cited 
J  which  would  seem  incredible,  were  they  not  easily  verified. 
I!  Fields  which  three  or  four  years  ago  were  sold  for  2  paper 
I!    piastres   per    acre    are    to-day  worth  30,  and   lands  w^hich 

were   sold  for  25   to   30   piastres   are   now  sold  for  80  and 
If    100  piastres.* 
It  Lucerne  farms   also   increase   the   value   of   the  land  in 

II  their  neighbourhood.  It  is  enough  to  use  the  phrase,  "  good 
J  land  for  lucerne,"  and  the  land  referred  to  will  immediately 
1!    realise  a  high  commercial  value. 

II  !  Of  the  profits  to  be  derived  from  lucerne  when  exploited 
ii  I  in  a  rational  and  up-to-date  manner,  we  may  judge  from  a 
y  single  instance  reported  in  the  Buenos  Ayres  Standard  :  a 
It .  league  t  of  meadows  sown  with  lucerne  in  La  Penca,  in  the 
II  I  south  of  the  Province  of  Cdrdoba,  has  yielded  in  a  year  a 
i  1  profit  of  £30,000 ;  and  in  another  year  it  actually  produced 
i  i  a  profit  of  £42,800.  This  journal  also  adds  that  a  league  of 
o;  I  similar  land  in  New  Zealand  would  be  worth  no  less  than 
I !  £360,000.  t 

The  constant  increase  of  sown  lands  is  certainly  the  most 
;;  .  notable  feature  of  the  agricultural  situation.  It  is  the  more 
(j  1  interesting  to  note  that  of  late  years  this  development  has 
oi :  been  due  to  the  nation's  own  resources,  as  after  the  politico- 
j :  financial  crisis  of  1890  the  current  of  immigration  and 
J  i  colonisation  which  had  assisted  agriculture  in  previous 
J :  years  was  almost  completely  checked.  As  soon  as  the  flow 
of  immigration  is  re-established — and  it  seems  to  us  that 

t  *  Probably  the  reader  need  not  be  told  that  the  roots  of  the  lucerne 
'*  <  plant  accumulate  enormous  quantities  of  nitrogen-yielding  bacilli,  thus  produc- 
iji  I  ing  organic  compounds  in  the  soil,  ready  for  use  by  the  next  crop  sown.  The 
J  ';  old  practice  of  sowing  clover  and  ploughing  the  roots  into  an  exhausted  field 
'  I   roTives  the  land  in  this  manner. — [Trans.] 

+  This  league  is  that  of  2500  hectares,  or  G175  acres  ;  making  the  linear 
\  I   league  3-14  miles.— [Tkans]. 

X  Cj,  j^nales  de  la  SociedaJ  rural  Argentina ;  Art.,  £1  Pais  de  In  Alfalteu. 


140    THE  ARGENTINE  IN  THE  20th  CENTURY 

it  is  already  recovering,  thanks  to  the  attractive  power  of 
the  abundant  harvests  rather  than  to  any  political  or 
administrative  measure  —  we  shall  certainly  see  that  the 
agricultural  yield  of  the  Republic  will  receive  a  fresh 
impulse  from  this  cause. 

The  35  millions  of  acres  sown  in  1908-9  represent  a  little 
over  4'07  per  cent,  of  the  entire  surface  of  the  country,  as  com- 
pared to  a  percentage  of  '008  in  1888.  Besides  this,  w^e  must 
not  forget  that  according  to  the  figures  of  the  agricultural  and 
pastoral  census  of  1908,  646,620  square  miles,  or  rather  more 
than  39  per  cent.,  are  employed  in  the  feeding  of  67,211,754 
sheep,  29,118,625  horned  cattle,  7,531,376  horses,  465,037  mules, 
and  285,088  asses. 

Finally,  if  we  admit  the  possibility  of  considerably 
increasing,  by  means  of  the  intensive  system,  the  yield  of 
cultivated  soil,  we  see  that  it  will  also  be  possible,  on  the 
same  stretch  of  land,  to  increase  the  number  of  head  of 
cattle  ;  so  that  it  is  permissible  to  conclude  that  the  Argentine 
Republic  can  still  conveniently  give  up  a  third  of  her  surface 
to  colonisation,  without  in  the  least  affecting  or  damaging 
the  industry  of  stock-raising. 

Knowing  the  extraordinary  progress  attained  by  Argentine 
agriculture  during  the  last  twenty  years,  as  well  as  the 
development  of  each  of  the  particular  crops  preferred  by 
the  Argentine  farmer,  we  must  now  inquire  in  what  regions 
of  the  country  this  expansion  has  made  itself  particularly 
felt.  For  this  purpose  we  will  divide  the  Republic  into 
geographical  belts,  confining  ourselves  here  to  an  examina- 
tion of  these  Provinces  in  which  agricultural  progress  has 
been  particularly  notable,  and  limiting  ourselves  to  the  three 
principal  forms  of  culture  : 

Total  Surface  cultivated  during  the  Agricultural  Year 
1908-1909. 


Geographical  Belts. 

Number  of  Acres  Cultivated. 

viNCE  OF  Buenos  Ayres— 

Northern  Section 

998,940 

Western  Section   ... 

3,043,700 

Central  and  Southern  (first  group)   ... 

1,807,190 

Central  and  Southern  (secona  groupj 

2,765,980 

8,605,810 

AGRICULTURE  m 


BrouRhl  forward, 

Geographical  Kelts. 

Nu 

nber  of  Acres  Cu 

Itivated. 

Pbovinck  of  Santa  Fe— 

Northern  Section         

326,210 

Central  Section            

3,194,698 

Southern  Section         

1,455,650 

4,976,558 

Province  of  Entke  Rios— 

First  Section    ... 

... 

360,300 

Second  Section 

506,950 

Third  Section 

527,980 

1.395,230 

Province  ok  Cokdoba     

4,064,760 

TeRRITOKV    of    PaMPA    CENTKAt, 

913,900 

Total     19,956,J^58 

It  will  be  seen  from  this  table  that  the  great  agricultural 
belt  of  the  Argentine  is  formed  by  the  Province  of  BuenoH 
Ay  res,  Santa  Fe,  Cordoba,  Entre  Rios,  and  the  Territory  of 
Pampa  Central.  This  latter  has  taken  an  important  place 
ill  the  national  production,  and  so  rapidly,  that  we  may  still 
prophesy  a  notable  expansion  of  its  resources.  The  other 
productive  belts  have  in  proportion  made  less  progress, 
excepting  the  Province  of  Mendoza,  where  vine-growing 
has  been  developed,  and  that  of  Tucuman,  where  the  culture 
of  the  sugar-cane  has  made  great  strides. 

There,  for  the  moment,  the  progress  of  agriculture  has 
halted,  as  the  other  districts  will  only  be  develojjed  later  on, 
when  the  populations  of  the  former  regions  overflow,  unless 
some  hitherto  unexploited  source  of  wealth — such  as  the 
quebracho  in  Chaco — attracts  capital  and  labour. 

At  the  time  of  the  last  harvest  the  Province  of  Buenos 
Ay  res  was  in  the  front  rank  in  the  matter  of  wheat,  no  less 
than  6,184,130  acres  being  devoted  to  that  cereal.  This 
enormous  area  represented  an  increase  of  2,933,920  acres 
since  the  year  1901-1902,  and  of  5,2-54,310  acres  since  1895. 
If  we  compare  this  figure  with  that  of  1888,  when  only 
609,560  acres  were  under  wheat,  we  find  an  increase  of 
5,574,570  acres. 

Of  the  6,184,130  acres  of  wheat  sown  in  the  Province  of 
Buenos  Ayres  in  1908-1909, 3,620,300  acres, or  53  per  cent.,  were 
in  the  region  known  as  the  "  Centre  and  South  "  (the  lir.st  and 
second  groups  united),  formed  by  an  assemblage  of  lifty-six 


142      THE  ARGENTINE  IN  THE  20th  CENTURY 

cantons,  of  which  some,  although  they  were  only  lately  affected 
by  the  movement  which  has  turned  untouched  and  desert 
prairies  into  green  fertile  fields,  are  to-day  important  centres 
of  production,  having  a  considerable  influence  upon  the 
commercial  balance  of  the  country. 

The  real  development  of  agriculture  in  the  Province  of 
'Buenos  Ayres  dates  only  from  1895.  Until  then  it  was 
considered  merely  as  a  country  especially  adapted  for  stock- 
raising,  and  this  false  conception  was  so  rooted  in  many 
minds  that  it  was  believed  that  agriculture  was  out  of  the 
question,  except  in  the  Province  of  Santa  Fe.  Comparing 
statistics,  we  find  that  the  latter  Province  had  992,080  acres 
of  wheat  in  1888  and  2,470,000  in  1895,  while  Buenos  Ayres 
boasted  only  of  510,090  and  906,490  acres  in  the  same  years. 

It  was  much  the  same  with  linseed  ;  the  figures  being 
180,300  and  657,020  acres  in  Santa  Fe,  and  108,650  and : 
160,550  in  Buenos  Ayres.  Maize  formed  an  exception; 
while  Santa  Fe,  in  the  two  years  given,  had  only  150,670 
and  429,540  acres  under  maize,  Buenos  Ayres  had  1,259,700 
and  1,652,430  acres. 

Only  in  the  agricultural  year  1901-1902  did  Buenos 
Ayres  step  in  front  of  Santa  Fe,  and  attain  such  crops  of 
wheat  as  until  then  were  unknown,  leaving  all  competitors 
far  behind.  In  the  matter  of  linseed,  for  which  Santa 
Fe  has  always  had  a  special  predilection,  that  Province  has 
always,  since  1888,  maintained  its  superiority  over  BuenoS; 
Ayres.  As  for  maize,  Buenos  Ayres  retains  its  superior 
position,  although  it  is  just  to  admit  that  in  1901-1902  the: 
other  Province  made  considerable  progress.  j 

Before  leaving  Buenos  Ayres,  we  must  mention  that  the- 
second  place  in  the  culture  of  wheat,  is  taken  by  the  region 
known  as  the  West,  which,  with  its  1,471,360  acres,  or  29  pei^ 
cent,  of  the  total,  forms,  like  the  analogous  region  in  North 
America,  one  of  the  great  grain  districts  of  the  Argentine 
In  this  region  there  are  cantons,  such  as  those  of  Nueve  d( 
Julio,  Lincoln,  Pehuajo,  General  Villegas,  Trenque  Leuquen 
and  others,  which,  reputed  from  all  time  unfit  for  agriculturej 
have  surprised  every  one  by  revealing  themselves  as  absolute, 
mines  of  wealth.  This  region  has  been  touched,  it  is  tru©: 
by  the  magic  ring  of   the  railroad,  which  has  unrolled  ii 


AGRICULTURE  143 

these  new  territories,  so  full  of  uuexploited  wealth,  an 
immense  network  of  tracks,  whose  marvellous  effects 
make  us  think  of  the  tales  of  the  Thousand  and  One 
Nights. 

It  is  in  this  region  that  we  have  seen,  as  the  logical 
result  of  the  agricultural  awakening,  the  most  surprising 
increase  in  the  value  of  the  soil.  These  prices  mounted  by 
leaps  and  bounds  ;  from  £1,  15s.  to  £3,  10s.,  from  £3,  10s.  to 
£7,  from  £7  to  £8,  16s.  per  acre,  and  even  more;  yet 
one  is  forced  to  admit  that  this  increase,  though  apparently 
capricious,  has  a  real  enough  foundation,  since  it  is  based 
upon  the  remunerative  qualities  of  the  soil. 

In  the  Province  of  Santa  Fe,  the  cradle  of  the  agricultural  ^ 
settlement  in  the  Argentine,  there  are  at  present  820  colonies 
and  cultivated  lands,  of  which  the  surface  under  seed  em- 
braces an  area  of  7,223,980  acres,  divided  as  follows :  Wheat, 
3,259,920  acres;  linseed,  2,037,990  acres;  pea-nuts,  29,390 
acres;  lucerne,  1,787,280  acres  ;  other  crops,  111,400  acres. 

The  Province  of  C6rdoba  has  furnished  another  of  the 
Argentine's  agricultural  surprises.  Neglected,  not  so  long  '' 
igo,  by  the  stream  of  immigration  which  set  in  for  preference 
towards  Santa  Fe  or  Buenos  Ayres,  Cordoba  began  to  attract 
•:he  attention  of  labourers  when  the  latter  (discouraged  by 
some  calamitous  years  in  Santa  F^)  were  drawn  thither  by  the 
fertility  of  its  soil,  the  scarcity  of  swamps,  the  regular  rains, 
jhe  cheap  land,  and  the  proximity  of  centres  of  consumption 
ind  ports  of  embarkation,  and  by  the  facilities  of  transport 
offered  by  an  extensive  network  of  railways.  There  the 
abourers  set  up  their  tents,  and  their  numbers  increased 
lay  by  day ;  there  they  devoted  themselves  to  the  strenuous 
.ask  of  reclaiming  the  virgin  soil,  and  there,  in  return,  they 
)btained  magnificent  harvests,  a  veritable  benediction  of 
:(rateful  nature. 

The  results  surpassed  all  expectation ;  to  such  a  degree, 
■hat  to-day  the  Province  of  Cordoba  is  one  of  the  first  / 
:olonial  centres  of  the  Republic,  and  the  Province  which 
ttfers  the  most  brilliant  future  to  the  cattle-breeder  and  the 
agriculturalist.  To-day  the  transformation  of  the  soil 
:)rogresses  so  rapidly  as  to  astonish  both  natives  and 
foreigners. 


144    THE  ARGENTINE  IN  THE  20th  CENTURY 

To  give  some  idea  of  the  enormous  development  of  this 
Province,  it  is  enough  to  say  that  in  1898-1899  it  counted 
176  colonies  and  71  settled  estates.  In  1905-1906  these 
figures  were  respectively  348  and  190.  The  size  of  these 
colonies  has  increased  in  the  same  proportions  ;  in  1898-1899 
their  area  was  roughly  3,800,000  acres;  it  increased  to 
8,910,000.  Of  this  enormous  area,  reclaimed  and  cultivated 
at  the  time  of  harvest  in  1898-1899,  some  3,150,000  acres 
represented  wheat,  434,500  linseed,  and  355,000  maize.  We 
must  also  mention  another  important  crop,  which  covers 
a  large  area  of  the  Province  of  Cordoba;  lucerne,  which  is 
represented  by  some  2,240,000  acres. 

But  the  most  surprising  fact  concerning  the  Province  of 
Cordoba  is  not  the  vast  area  under  the  plough,  but  the 
prodigious  increase  of  crops  of  every  kind.  Thus  the  area 
sown  with  wheat,  which  in  1898-1899  was  1,588,800  acres, 
was  2,417,920,  in  1903-1904  and  2,695,620  in  1904-1905.  It 
is  the  same  with  linseed  ;  in  1898-1899  184,490  acres  were 
sown  ;  in  1903-1904,  439,830  acres.  These  figures  give  some 
indication  of  the  vast  agricultural  future  which  lies  open 
before  this  Province. 

Another  agricultural  revelation  has  been  aftbrded  by  th( 
Territory  of  Pampa  Central,  which  in  1888  had  only  14,90( 
acres  under  the  plough;  some  11,000  being  in  maize,  210( 
in  lucerne,  and  300  in  wheat.  In  1895  it  contained  25,52( 
acres  under  culture,  and  in  1903  308,750  acres  were  bearin; 
crops  of  various  kinds ;  wheat,  71,630  acres,  and  maiz€ 
419,900;  and  in  1908-1909,  the  Pampa  contained  913,90f 
acres  of  cultivated  soil  ;  790,040  under  wheat,  74,000  unde 
linseed,  and  49,400  under  oats. 

In  the  space  of  twenty  years  the  Pampa,  once  regarde; 
as  a  sterile  waste,  almost  impossible  of  cultivation  or  cl 
settlement,  has  seen  a  great  development.  It  contains  to-da' 
more  than  80,000  inhabitants ;  twenty  centres  of  population; 
about  914,000  acres  under  cultivation;  464,645  cattk: 
4,809,077  sheep,  and  281,537  horses ;  with  an  annual  expoi' 
of  products  estimated  at  15  millions  of  paper  piastres,  ( 
£1,280,000. 

Its  soil  hns  greatly  risen  in  value  ;  the  square  league  < 
2500  hectares  (or  6175  acres,  or  a  square  nearly  314  miles  c 


AGRICULTURE  145 

the  side,  or  just  under  10  square  miles)  sells  for  anything 
up  to  100,000  paper  piastres,  or  £8800  ;  and  even  in  the 
remoter  cantons  it  will  sell  for  £3500  or  £4400.  This 
extraordinary  progress  has  been  accomplished  quite  recently ; 
it  dates  back  hardly  three  years,  and  the  prices  tend  to 
1  increase  each  day. 

j  Before  completing  this  sketch  of  the  agricultural  products 
|of  the  Argentine,  according  to  the  official  statistics,  we  must 
I  remind  the  reader  that  the  total  of  these  products  increases 
;by  leaps  and  bounds,  so  that  the  figures  given  must  be 
; regarded  as  strictly  provisional,  on  account  of  the  great 
development  to  be  foreseen  as  new  centres  of  colonisation 
are  formed.  The  Pampa  Central,  of  which  we  have  just 
I  spoken  as  a  very  mine  of  wealth,  is  capable  of  producing  in 
the  future  enough  meat  and  grain  to  nourish  a  great  part 
lof  the  population  of  the  world. 

i  In  the  Argentine  men  employ,  for  the  more  important 
crops,  such  as  wheat,  maize,  linseed,  lucerne,  etc.,  the  latest 
and  most  perfect  agricultural  implements  and  machines ; 
.cultivators,  ploughs,  drills,  harvesters,  etc.,  etc.  We  have 
not  space  to  mention  all ;  but  it  is  enough  to  say  that  in 
jthe  regions  where  farming  on  a  large  scale  is  the  rule,  a 
I  progressive  spirit  is  in  the  air,  which  impels  the  owners  of 
I  great  establishments,  and  even  simple  settlers,  to  furnish 
;  themselves  with  the  very  best  machinery,  for  which  they 
sometimes  pay  considerable  sums.  That  agriculture  has 
;  achieved  the  rapid  expansion  of  which  we  have  just  given 
i details,  notwithstanding  the  little  help  which  immigration 
jhas  lately  rendered,  is  due  principally  to  the  employment  of 
jthe  perfected  machinery  in  common  use. 

1  The  best  types  of  ploughs,  harrows,  drills,  and  reapers  of 
jail  kinds — binder-reapers,  traction-engines,  winnowing  and 
ithrashing  machines,  all  of  the  best  construction  and  the  most 
I  recent  model — are  familiar  to  the  Argentine  farmer,  who 
1  makes  constant  use  of  them. 

I  The  owners  of  the  great  "  estancias  "  make  all  necessary 
sacrifices  in  order  to  work  their  estates  in  the  latest  and 
most  perfect  manner.  The  machinery  comes  from  the 
United  States,  and  facilitates  all  the  operations  of  la  grande 
culture.     Two   or   three   years   ago,   for  example,   saw    the 


146    THE  ARGENTINE  IN  THE  20th  CENTURY 

advent  of  a  new  machine,  simple  and  of  moderate  price, 
which  replaced  the  reaper  and  thrasher,  by  performing  both 
operations  at  once  as  it  moved.  It  reaps  the  ears  of  corn, 
winnows  them,  grades  the  grain,  and  pours  it  into  sacks ; 
leaving  the  straw,  it  is  true,  but  the  value  of  straw  in  the 
Argentine  is  negligible.  All  these  operations  are  performed 
as  the  machine  progresses ;  four  horses  are  enough  to  draw 
it.  With  this  new  machine  corn  that  is  standing  in  the 
morning  is  reaped  during  the  day,  and  by  the  evening  is 
ready  for  despatch  to  the  port  of  embarkation. 

To  give  some  idea  of  the  extent  to  which  agricultural 
machinery  is  used  in  the  Argentine,  we  may  mention  that 
in  the  period  1890-1904  there  were  imported  from  abroad, 
mostly  from  the  United  States,  459,006  ploughs,  officially 
valued  for  customs  purposes  at  £1,331,409  ;  22,783  winnowers, 
valued  at  £277,976;  98,470  reapers,  valued  at  £2,041,982; 
37,824  drills,  or  sowers,  valued  at  £176,268;  and  4770 
thrashing-machines,  valued  at  £1,250,184.  From  1898  to 
1904  13,725  maize  buskers  were  imported,  valued  at  £340,479. 

To  complete  these  data  we  append  a  table,  giving  tht 
number  of  agricultural  machines  imported  in  the  course  o] 
the  years  1905,  1906,  1907  and  1908: 


1905 

1906 

1907 

1908 

Ploughs        

..     66,404 

84,948 

59,196 

29,775 

Winnowers  or  buskers 

790 

785 

134 

98 

Reapers 

..     14,492 

20,739 

17,334 

18,722 

Drills  or  sowers 

..       7,911 

25,447 

13,975 

9,528 

Harvesters  ... 

706 

2,011 

226 

1,866 

Thrashers 

909 

1,136 

490 

969 

We  must  also  mention  that  there  has  been  a  grea 
development  of  factories  in  the  Argentine,  which  turn  oi] 
agricultural  machinery  and  implements  ;  some  of  these  hav 
been  established  with  large  amounts  of  capital,  and  posses 
an  equipment  fully  equal  to  that  of  the  best  equippe 
establishments  of  Europe. 

The  Agricultural  Yield. 

Having  now  considered  the  agricultural  progress  achievi 
in  the  Argentine,  the  areas  under  seed  at  different  perioc 
the  prevailing  crops,  and  the  regions  in  which  agriculture  1 
more  especially  established,  we  must  now  study  the  results  : 


AGRICULTURE  147 

agriculture ;  that  is  to  say,  its  yield,  and  shall  attempt  to 
forecast  the  future  reserved  for  the  country. 

As  we  have  already  stated,  there  are  no  complete  statistics 
available,  such  as  there  are  in  the  United  States  and  in  other 
countries,  which  give  in  detail  the  cost  of  working  farms  of 
various  sizes,  and  the  prices  at  whicli  the  latter  sell  their 
produce ;  and  it  is  only  from  such  details  that  we  can 
calculate  the  net  profit  of  each  acre.  But,  despite  this 
lack,  we  can  probably  find  the  data  we  require  by  resorting 
to  the  opinion  of  those  competent  in  such  matters,  either 
because  they  are  themselves  practising  farmers,  or  be- 
cause they  have  set  themselves  the  same  problem  as  that  we 
are  facing. 

In  the  good  lands  of  the  Provinces  of  Cdrdoba  and  Buenos 
Ayres,  and  in  the  Pampa  Centrale,  the  hectare  may  yield  the 
settler  50  piastres  (in  notes),  or  £4,  8s. ;  in  other  words, 
£1,  15s.  7|d.  per  acre;  provided  there  is  no  hail,  and  if  he 
escapes  the  other  agricultural  plagues.  Some  estates  this 
year  have  produced  as  much  as  2000  kilos  of  wheat  per 
hectare,  or  29  bushels  per  acre ;  yielding,  at  |6  per  ton  (the 
Argentine  ton  of  2205  lb.)  a  yield  of  120  piastres*  (paper) 
per  hectare,  or  £4, 5s.  G^d.  per  acre.  Estimating  the  expenses 
at  25  to  33  per  cent.,  there  remains  a  profit,  let  us  say,  of  £3, 
from  which  we  must  still  deduct  some  10s.  for  rent,  so  that 
the  labourer  draws  a  final  profit  of  70  piastre  notes  per  hectare, 
or  £2,  10s. 

In  one  particular  establishment,  not  far  from  the  station 
of  Labenlaye,  on  the  Buenos  Ayres  Pacific  line,  the  yield  of 
a  family  of  metayers,  who  cultivate  125  to  150  acres,  and 
pay  a  quarter  of  the  crop  to  the  proprietor,  and  also  work  on 
the  cattle-ranch  on  days  when  there  is  no  work  in  the  fields, 
make  an  annual  profit  of  £88  a  year.  This  is  equivalent  of 
a  profit  of  from  lOs.  4d.  to  14s.  4d.  per  acre,  earned  by 
cultivating  the  soil  as  metayers  or  tenants  in  kind,  retaining 
75  per  cent,  of  the  crop  ;  but  it  must  be  remembered  that  this 
is  absolutely  a  net  profit :  all  the  labourers'  expenses,  the  cost 
of  nourishment,  clothing,  and  other  current  expenses,  are  all 
debited  first ;  so  that  the  £88  may  be  saved  or  spent  or  invested. 

*  The  piastre  note  is  approximately  worth  2  2  francs,  or  19  2  pence — 
Is.  7ld. 


148    THE  ARGENTINE  IN  THE  20th  CENTURY 

But  an  argument  more  eloquent  than  all  the  arithmetical 
demonstrations  which  we  might  draw  from  particular  cases 
is  the  well-known  fact  that  every  year  a  large  number  of 
labourers  become  the  proprietors  of  the  holdings  they 
cultivate,  or  acquire  other  holdings  in  the  neighbourhood. 
It  is  by  no  means  an  exceptional  thing  for  those  who 
cultivate  a  tract  of  land  to  draw  from  it  in  a  single  year  a 
sufficient  sum  of  money  to  acquire  it  for  themselves,  while 
reserving  the  expenses  of  sowing  and  other  work  to  be  dune 
before  the  next  harvest. 

To  support  this  statement,  here  are  a  few  exacter  details 
as  to  the  capital  required  to  reclaim  a  holding  and  its 
approximate  yield. 

According  to  calculations  furnished  by  a  man  of  great  ex- 
perience in  matters  of  colonisation,  the  capital  required  by  a 
family  of  four  or  five  persons  cultivating  250  acres  of  wheat, 
including  the  expense  of  installation  in  the  first  year,  may 
be  estimated  as  follows  : — 

£       8.      D. 


Two  Ploughs,  sulky  type 

21     2 

0 

Two  Harrows,  threefold    ... 

7  18 

0 

One  Roller 

4     8 

0 

One  Husker  or  winnowing  machine 

39  12 

0 

Twenty  Oxen           

88     0 

0 

Two  Horses              

8  16 

0 

Two  Carts 

35     4 

0 

Harness,  chains,  implements,  etc. 

8  16 

0 

House,  corral,  well,  fencing         

...       105  12 

0 

;^31!)      8 

_0 

The  family  or  the  colonist  who  does  not  possess  such  capital 
will  find  rich  proprietors  or  colonists  who  will  furnish  him 
with  implements,  draught  animals,  and  seed  corn,  as  well  as 
the  necessaries  of  life.  The  harvest  over,  the  seed  corn  is 
reserved  for  the  next  sowing ;  the  expenses  of  the  harvest 
are  deducted,  and  the  net  profit  is  halved,  one  half  going 
to  the  proprietor,  and  one  to  the  colonist.  It  is  thus  that 
the  majority  of  immigrants  begin  to  earn  the  capital  which 
enables  them  to  become  proprietors. 

For  bachelor  immigrants  there  is  another  method,  which 
gives  excellent  results:  they  place  themselves  with  colonists 
who  possess  some  capital  as "  interested  servants,"  or  profit- 
sharing  labourers,  lending  their  services  from  the  ploughing 


AGRICULTURE  149 

to  the  harvest  of  wheat  and  linseed.  They  receive  for  their 
services  fuod,  board,  and  6  or  7  per  cent,  of  the  gross  profit  of 
100  hectares.  They  put  the  sums  received  during  three  or 
four  years  out  at  interest,  and  have  then  sufficient  money  to 
buy  the  necessary  implements  and  to  become  tenant  farmers. 
Three  or  four  years  later  they  buy  land  on  the  instalment 
system,  and  finally  become  large  land-owners  ;  one  may  count 
by  the  hundred  those  who  have  followed  this  course,  have 
become  the  proprietors  of  wide  tracts  of  land,  and  have 
to-day  made  large  fortunes. 

As  soon  as  he  is  a  land-owner  the  colonist  or  farmer  has 
already  an  almost  certain  future  before  him,  as  the  net 
profits  he  obtains  each  year  accumulate  in  geometrical 
progression,  unless  some  fatality  pursues  him :  a  thing  that 
is  of  sufficiently  rare  occurrence.  To  gain  some  idea  of  his 
net  profits,  we  turn  to  the  following  details,  which  are 
drawn  from  a  competent  source : 

Approximate  Estimate  of  the  Expenses  and  the  Yield  of 

247  acres  of  land  soivn  with  Wheat. 

Expenses. 
Preparing  the  soil. — Two  plonghings  and  a  raking, 

at  2s.  3^d.  per  acre  

Sowing,  drilling  and  harrowing,  at  ;3'38d.  per  acre 
Seed. — 238  bushels  of  seed  corn,  at  £8, 16s.  per  ton  ... 
Harvest. — Reaping  and  stacking;  at  4s.2"68d.  per  acre 
Thrashing. — 4400    bushels    (120   tons)    of   grain,    at 

17s.  6d.  per  ton 

Sact.'!.— 1500,  at  5-024d.  each 

Transport. — To  granary,  port   or   station,   120  tons 

at  8s.  8d.  per  ton 

Rent. — 247  acres,  at  Ss.  6-6d.  per  acre  (approx.)  ... 
General    expenses.  —  Repairs,    tools,    dilapidations, 

wages,  hire  of  machinery,  etc. 

Total     

Receipts. 
Sale  of  120  tons  (4400  bushels)  of  wheat,  at  £(i,  3s. 

2id.  per  ton  (3s.  4  •28d,  per  bushel)  *      

Expenses  of  growth  and  preparation  ... 

Settler's  net  profit     

In  short,  a  profit  of  about  one  pound  per  acre. 

*  At  the  present  price  (22  francs  per  100  kilos,  or  about  £8,  IGs.  per  ton 
the  sale  would  produce  £1050,  a  net  profit  of  £.571.     This  is  unusuiil. 


£  S. 

D. 

28  3 

2 

3  10 

5 

.-.7  4 

0 

52  IG 

0 

105  12 

0 

26  8 

0 

52  16 

0 

105  12 

0 

52  16 

0 

£484  17 

7 

£   s. 

1). 

731>  4 

0 

484  17 

7 

£254  7 

5 

150    THE  ARGENTINE  IN  THE  20th  CENTURY 

The  above  figures  relate  to  the  property  known  as  "  La 
Vizcaina,"  in  the  Department  of  Bolivar;  it  consists  of 
123,800  acres  of  agricultural  land,  or  183  square  miles,  and 
is  the  largest  agricultural  farm  in  the  Republic  belonging 
to  a  single  owner  or  held  by  a  single  tenant.  It  must  be 
mentioned  that,  on  the  whole,  the  land  is  high  ;  it  has  never 
been  invaded  by  locusts  ;  the  depth  of  the  mould  or  upper 
soil  is  considerable,  and  the  property  has  two  railway 
stations  built  upon  it  and  a  third  about  2|  miles  distant, 
which  facilitate  the  despatch  of  the  harvests. 

The  above  figures  do  not  give  a  precise  idea  of  the  farmer's 
situation,  since  agricultural  land  is  let  for  four  years,  and  in 
four  years,  six  harvests  may  be  obtained  (three  of  wheat  and 
three  of  maize),  which  sensibly  diminishes  the  cost  of  working 
and  increases  the  profits  in  proportion. 

We  may  use  the  same  table  as  relating  to  linseed, 
substituting  £7,  18s.  6d.  per  ton,  or  thereabouts,  for  the  sow- 
ing, and  £1,  Is.  per  ton  for  thrashing.  In  this  district  linseed- 
farming  is  accompanied  by  certain  risks,  on  account  of  the 
scanty  rain  and  the  late  frosts ;  sometimes  the  harvest  is  j 
7,  8,  or  10  quintals  (metric)  per  hectare,  but  it  is  usually  onlyi 
3  or  4.* 

In  order  that  these  figures  representing  the  farmer's  profit 
shall  give  a  true  idea  of  the  reality,  it  must  be  remembered 
that  besides  the  wheat  crop  he  can  also  obtain  another  and 
equally  profitable  crop  of  maize  in  the  same  year,  and  he 
may  also  increase  his  profits  by  fattening  pigs  and  raising 
game  and  other  products  which  command  a  ready  sale  ini 
the  neighbouring  towns.  ' 

These  examples  must  not  of  course  be  taken  as  represent- 
ing a  general  law  ;  the  net  income  of  course  depends  upon 
the  cost  of  production  and  the  yield  of  each  harvest,  andj 
these  two  factors  may  vary  infinitely,  where  the  crops  undei 
consideration  are  as  large  as  those  raised  in  the  Argentine 
But  what  we  may  affirm  is  that,  besides  a  certain  number  oi 
farms  lying  fallow,  there  are  hundreds  of  thousands  of  acres 

*In  normal  years,  if  the  fields  have  been  well  worked,  one  may  count  oi 
an  average  of  30  bushels  of  wheat  per  2i  acres,  or  14  per  acre  ;  ?S  bushels  o 
maize  per  acre,  and  12 '5  bushels  of  linseed  per  acre.  On  virgin  land  th 
results  are  often  of  great  interest ;  for  it  is  not  uncommon  to  obtain  over  2 
bushels  of  wheat  per  acre  fl  ba8hel  =  60  lbs.). 


AGRICULTURE  151 

of  virgin  soil,  purchasable  at  a  low  price,  on  which  it  is 
enough  to  cast  the  seed,  after  a  superficial  cultivation,  in 
order  to  obtain  a  splendid  harvest.  In  conditions  as  favour- 
able as  these,  and  using  machinery  which  enables  the  farmer 
to  cultivate  enormous  surfaces  with  little  labour,  there  are 
always  serious  probabilities  of  success  for  the  agriculturalist. 
This  it  is  that  explains  the  great  increase  of  cultivated  lands 
during  the  last  few  years,  whether  virgin  lands  divided  and 
sold  by  the  owner,  or  lands  leased  to  tenants  who  pay  in 
kind  or  give  up  a  percentage  of  the  crops. 

In  a  country  whose  soil  gives  such  wonderfully  abundant 
yields,  great  fortunes,  and  fortunes  rapidly  made,  are 
common.  The  Argentine,  like  the  United  States,  has  her 
legendary  type  of  immigrant,  who  has  progressed  in  a  very 
short  time  from  extreme  poverty  to  great  riches,  by  apply- 
ing his  energy  and  initiative  to  agriculture  or  stock-raising. 

Here    are    two    of    the    most    notable   and    best-known, 
examples. 

A  few  years  ago  there  died  in  the  Argentine  one  of  the 
greatest  landed  proprietors ;  a  man  named  Santamarina, 
whose  life-history  is  worth  relating. 

Son  of  a  small  farmer  of  Galicia,  Santamarina  decided, 
when  about  twenty  years  of  age,  to  seek  his  fortune  in 
America.  His  means  not  permitting  him  to  meet  the 
expenses  of  the  voyage,  he  resorted  to  the  classical  pro- 
cedure ;  he  shipped  as  a  stowaway  on  a  vessel  about  to  leave 
Vigo  on  a  voyage,  to  Buenos  Ayres. 

Discovered  on  the  voyage,  the  captain  had  compassion  on 
him,  kept  him  on  the  vessel  and  landed  him,  fifty  years  ago, 
in  the  capital  of  the  Argentine  ;  without  any  resources,  and 
.sustained  only  by  the  hope  of  gaining  a  livelihood  more 
easily  than  in  Spain. 

Santamarina  immediately  made  his  way  towards  the  great 
plaza,  where  the  produce  of  the  country  was  at  that  time  sold  ; 
and  there,  hoping  to  secure  a  job,  he  spoke  to  a  man  who 
was  C(mducting  a  wagon,  and  whose  business  it  was  to 
bring  wool  from  the  country  into  the  Buenos  Ayres  market. 

This  man,  seeing  him  strong  and  willing,  offered  to  share 
with    him   his  work   as   wagoner  ;   but  he  first  inquired    of 


152    THE  ARGENTINE  IN  THE  20th  CENTURY 

Santatnarina  whether  he  possessed  a  knife,  as  at  that  time 
in  the  Argentine  it  was  the  necessary  instrument  of  defence, 
and  at  need,  of  attack,  and  was  also  employed  in  all  the 
usages  of  the  nomad  life. 

Santamarina  had  no  knife ;  but  he  had  a  piastre,  which 
the  captain  had  given  him  before  he  left  the  ship,  and 
with  this  piastre  he  bought  a  knife,  which  served  in  this 
partnership  as  his  only  capital. 

Having  led  the  common  wagon  for  some  time, 
Santamarina  had  saved  enough  to  buy  a  better  one  for 
his  own  ;  then,  chance  aiding  him,  he  purchased  a  few  sheep 
whose  wool  he  sold ;  and  finally,  by  dint  of  work,  he 
succeeded  in  saving  sufficient  capital  to  buy  a  little  land 
and  start  sheep-raising  on  his  own  account.  This  was  the 
beginning  of  his  success  ;  little  by  little  Santamarina  bought 
more  sheep  and  more  land,  and  became  in  the  end  one  of  the 
greater  landed  proprietors  of  the  Argentine.  He  died  in 
1904,  leaving  a  large  fortune  and  a  name  justly  honoured 
throughout  the  country. 

To-day  a  visitor  to  his  magnificent  "estancia"  of  Tandil  may 
still  see,  under  a  glass  shade,  the  knife  and  a  model  of  the 
wagon  which  were  the  first  instruments  of  his  fortune. 

The  second  story  is  more  commonplace,  but  no  less  true. 
Twelve  years  ago  two  Neapolitan  immigrants  came  to  settle  at 
Rosario.  To  gain  a  living,  and  no  doubt  in  memory  of  their 
former  trade,  they  founded  in  partnership  a  boliche  ;  that  is, 
a  bar  for  the  sale  of  drinks.  When  a  certain  time  had 
elapsed,  their  business  being  far  from  prosperous,  they^ 
decided  that  one  or  the  other  of  the  two  was  one  too  many, 
and  so  determined  to  separate.  But  which  of  the  two  should 
retain  the  boliche  ?  They  drew  lots  to  decide  the  point;  and 
he  whom  chance  favoured  retained  the  business  alone, 
while  the  other  went  in  search  of  his  fortune  elsewhere. 

The  latter,  far  from  allowing  himself  to  be  discouraged, 
made  for  Rosario  harbour,  in  search  of  a  new  trade :  he 
assumed  that  of  a  dock-labourer  or  lighterman.  This  was 
at  the  time  when  the  growing  of  maize  was  beginning,  in 
the  Province  of  Santa  E'e,  to  give  satisfactory  results.  Our 
hero,  having  spent  some  time  in  carrying  sacks  of  grain 
upon  his  back  from  the  quays  to   the  vessels  about  to  sail, 


conceived  the  idea  of  buying,  with  his  savings,  a  sack  of 
maize,  and  to  soil  it  retail,  in  the  country,  for  the  purposes  of 
seed.  This  first  venture  having  succeeded,  he  continued  his 
operations  with  a  larger  number  of  sacks;  then,  finally, 
he  abandoned  the  trade  of  porter  in  order  to  enlarge 
his  new  business,  which  from  that  time  increased  by 
thousands  of  sacks,  and  soon  became  a  great  export 
business. 

Thanks  to  the  development  of  the  culture  of  maize  in 
this  region,  he  has  become  one  of  the  greatest  merchants 
and  speculators  in  this  product,  and  enjoys  to-day  a  fortune 
of  many  millions,  while  his  companion,  less  happy  in  his 
afiairs,  still  keeps  the  little  drink-shop  in  Rosario. 


CHAPTER  II  j| 


THE   PRODUCTION   OF   WHEAT   IX   THE   ARGENTINE,   COMPARED 
WITH   THE   YIELD   OF   OTHER   EXPORTING   COUNTRIES 

The  world's  wheat-harvest — Comparison  between  the  statistics  of  consumption 
— The  conditions  of  production  in  Russia  and  in  the  Argentine — Comparison 
with  the  United  States,  India  and  Canada — The  prospects  of  the  Argentine 
export  trade  in  wheat. 

HAVING  described  the  progress  realised  by  the  Argentine 
Republic  in  the  course  of  the  last  few  years,  it  will  be 
not  without  interest  to  inquire  what  are  the  resources  of  those 
nations  which  are,  or  may  be,  the  competitors  of  the  Argentine 
in  the  world-market  and  in  the  production  and  consumption 
of  wheat. 

Here,  according  to  the  most  reliable  sources,  are  the 
figures  relating  to  the  average  yield  of  wheat  in  the  whole 
world  during  the  last  sixteen  years : — 

Period  Year  Year 

1894-1903.  1904.  1907. 

Europe  (bushels  of  60  lbs.)       ...     1,468,000,000  1,656,000,000  1,652,000,000 

America                     „                 ...        684,000,000  756,000,000  889,000,000 

Asia  and  Australia  „                 ...        295,000,000  396,000,000  458,000,000 

Africa                        „                 ...          43,000,000  57,600,000  54,800,000 


Totals  (approx.)      ...     2,490,000,000     2,865,600,000     3,050,000,000 

We  see  that  the  European  production  of  wheat  represents 
nearly  59  per  cent,  of  the  world's  production,  for  a  population 
which,  according  to  the  calculations  of  M.  Levasseur,  consists  of 
about  411  millions  of  inhabitants.  If  we  reduce  this  figure 
by  one-fourth,  thus  eliminating  infants  and  the  aged,  we  find 
that  this  population  disposes  of  only  272'8  lb.  of  wheat  per 
head,  or  521*2  lb.  less  than  the  "  type  "  or  standard  ration  of 
793'8  lb.  per  annum,  recommended  by  the  Bureau  of  Experi- 
mental Stations  of  the  Ministry  of  Agriculture  of  the  United 
States,  after  long  and  patient  research. 

In  pursuing  this  inquiry  into  the  distribution  of  wheat- 
production  among  all  the  countries  of  the  world,  we  shall  be 
able  to  judge  of  the  rank  occupied  by  the  Argentine  Republic, 
and  by  so  doing  to  rectify  an  error  which  is  frequently  com- 

154 


THE  PRODUCTION  OF  WHEAT  155 

mitted,  the  error  of  confounding  exportation  and  importation, 
which  gives  this  country  a  very  different  place  to  that  wliich 
is  its  right. 

Here  are  the  figures  showing  how  the  production  of  wheat 
is  distributed : — 


j                 Country. 

Period. 
1894-1903. 

Year. 
1904. 

Year. 
1907. 

;  J^nited  States  (bushols  of  GO  lbs. )    . 

..     576,000,000 

504,000,000 

601,000,000 

_Pussi.a                                  ,, 

.     360,000,000 

605,000,000 

547,000,000 

J^raneo                                  ,, 

.     316,000,000 

290,000,000 

336,000,000 

_^ustro-Hungary               ,, 

.     180.000,000 

170,000,000 

197,000,000 

Argentine  Republic          ,, 

.       76,000,000 

147,(100,000 

172,000,000 

Italy 

.     119,000,000 

143,000,000 

148,000,000 

Spain                                  ,, 

.       93,600,000 

91,800,000 

109,600,000 

Germany                              ,, 

.     116,000,000 

144,000,000 

101,700,000 

Canada                                 ,, 

.       63,000,000 

67,300,000 

82,000,000 

Roumania                           ,, 

.       57,600,000 

50,700,000 

54.800,000 

England                              „ 

.       54,000,000 

36,700,000 

47,000.000 

Bulgaria                              ,, 

— 

50,700,000 

42,800.000 

Asiatic  Countries             „ 

— 

340,000,000 

364,000,000 

Australia                           ,, 

— 

59,400,000 

82,000,000 

i  Other  European  Countries     ,, 

— 

78,800,000 

65,400,000 

African  Countries                    „ 

— 

47,000,000 

54,800,000 

Other  American  Countries    „ 

— 

29,000,000 

27,000,000 

Totals   (approx.)     ...     2,890,000,000   3,030,000,000 

This  table  shows  that  in  1907  the  Argentine  occupied  the 
fifth  place  as  a  wheat-growing  country. 

If  we  compare  this  production  of  wheat  with  the 
minimum  ration  of  793"8  lb,*  which  is  considered  indispens- 
able to  human  nutrition,  we  see  that  apart  from  European 
Russia,  with  its  116  million  inhabitants,  there  is  left  for  the 
remaining  300  millions  of  Europeans,  less  a  quarter,  as  we 
have  explained  above— that  is,  for  a  population  of  225  millions 
I— about  1,200,000,000  bushels  of  wheat.  This  quantity 
represents  an  average  of  151"5  lb.  per  head  per  annum,  or 
a  deficiency  of  249'7  lb.  per  head. 

The  population  of  Germany,  estimated  at  59  millions,  has 
only  147'4  lb.  of  wheat  per  head,  making  a  deficiency  of  644'6 
lb.  per  inhabitant. 

*  There  seems  something  improbable  about  this  figure.  For  one  thing,  very 
few  people  could  eat  over  2  lb.  of  wheat — representing  over  3  lb.  of  bread — per 
diem ;  and  white  bread  forms  no  important  part  of  the  diet  of  most  populations. 
Prob.-ibly    the    figures    represent    the    amount    of    bread    necessary  to    a   hard- 

.  .working  labourer,  whose  dietary  consists  chiefly  of  bread — a  diet  only  common 

I  to  the  south  of  England.  — [Trans.] 


^ 


156    THE  ARGENTINE  IN  THE  20th  CENTURY 

The  United  Kingdom  furnishes  its  42,500  inhabitants 
with  only  50"6  lb.  of  bread  per  annum,  leaving  a  deticiency 
of  741  4  lb.  per  head. 

Thus  Europe,  which,  without  Russia,  produces  more  wheat 
than  the  rest  of  the  world,  does  not  produce  enough  for  her 
own  consumption,  low  as  it  is.  It  is  therefore  necessary  to 
seek  out  these  wheat-producing  countries  which  are  in  a 
position  to  make  up  this  deficiency.  Now  at  the  present 
time  there  are  very  few  such  countries  ;  they  are  Russia,  the' 
United  States,  the  Argentine  Republic,  Canada,  and  India 
and  among  these  it  is  the  Argentine  for  which  the  most 
important  place  seems  to  have  been  reserved. 

Russia  has  hitherto  been  one  of  the  great  providers  <A 
wheat  to  Europe  ;  but  it  would  seem  that  this  position  if 
not  one  that  she  can  retain.  Russia  is  far  from  having 
attained  the  degree  of  agricultural  evolution  which  thi! 
Argentine  has  achieved  ;  it  is  true  that  she  exports  80  per  cent) 
of  her  wheat  harvest,  but  then  the  Russian  peasant  eats  onhi 
rye  bread.  Of  the  326  millions  of  acres  of  cultivated  land  ii! 
Russia,  30  millions  only  are  devoted  to  wheat,  or  rather  lesj 
than  double  the  area  used  for  the  same  cereal  in  France,  o 
just  double  the  wheat-area  of  the  last  Argentine  harvest. 

In  the  wheat-belt  of  Tchernoziora,  the  black  earth  is  all  i, 
cultivation,  and  its  extent  cannot  be  further  increased.  FertilU 
though  this  soil  may  be,  and  although  its  depth  is  from  12  to  4; 
inches,  the  results  amount  to  no  more  than  four  or  live  grains  ( 
wheat  for  each  grain  sown.  The  last  harvest  gave  about  5'a 
bushels  per  acre,  while  the  average  in  France  is  20  bushels.  \ 

These  results  are  due  chiefly  to  the  poverty  and  ignorand 
of  the  Russian  peasant;  it  often  happens  that  his  wheat  crc 
no  longer  belongs  to  him,  having  been  sequestrated  by  tl 
tax-gatherer  in  payment  of  unpaid  taxes.  On  the  other  hani 
the  Russian  peasant  cannot  procure  agricultural  machiner 
the  price  of  which  is  increased  by  exaggerated  tariffs.*     I;; 

*  More :  when  it  is  provided  for  him  he  frequently  will  not  use  it ;  or  it  und  '■ 
goes  a  series  of  remarkable  accidents,  so  that  the  harvest  has  to  be  gatheii 
by  hand.  This  is  more  especially  the  case  where  he  is  reaping  anothc) 
harvest,  when  his  object  is  to  ensure  the  employment  of  more  hands.  H<,J 
unable  to  understand  that  machinery  means  wealth  and  development.  It  is  o  if 
fair  to  say  that  it  seldom  does  in  Russia,  as  he  cannot  easily  get  more  lanc;f 
his  own,  and  his  master's  estate  is  often  hemmed  in  by  others. — [Trans.] 


THE  PRODUCTION  OP  WHEAT  157 

cannot  even  obtain  draught  animals,  his  wretched  resources 
not  allowing  him  to  procure  them. 

If  to  these  factors  we  add  the  progressive  exhaustion  of 
the  soil,  we  see  that  the  production  of  Russian  wheat  for 
export  is  very  near  its  limit ;  the  more  so  as  the  home 
consumption  of  wheat  tends  to  increase  with  the  economic 
development  of  the  country.  We  can  hardly  wish  otherwise 
than  that  these  peasant  farmers,  habituated  to  a  life  of  poverty, 
should  themselves  consume  some  of  the  wheat  they  produce, 
instead  of  contenting  themselves  with  i-ye. 

Let  us  now  compare  this  picture  of  Russian  production  to 
that  presented  by  the  Argentine. 

What  is  it  that  is  responsible  for  the  superiority  of  the 
Argentine  Pampa  over  the  Russian  steppes  ?  It  is  the 
inexhaustible  fertility  of  a  virgin  soil,  which  produces 
abundant  crops,  without  necessitating  artificial  enrichment, 
nor  even  the  system  of  the  rotation  of  crops.  The  soil  yields 
harvests  of  20  bushels  to  the  acre,  without  exhaustion,  pro- 
ducing for  many  years  in  succession,  as  it  is  doing  now  in 
Chubut,  in  the  south  of  Buenos  Ayres,  and  in  Cordoba, 
while  the  yield  of  the  Russian  harvests  is  only  55  bushels. 

For  the  exploitation  of  this  wealth,  Argentine  agriculture 
employs  the  most  perfect  machinery  to  be  obtained  in  the 
world,  employing  thousands  of  horses  also,  to  drive  it ;  while 
the  Russian  peasant  has  to  work  with  his  own  hands,  having 
neither  machines  nor  horses  to  multiply  his  strength. 

What  shall  we  say  of  the  prosperous  and  fortunate 
situation  of  the  Argentine  colonist,  who  is  not  only  enabled 
out  of  the  fruits  of  his  labour  to  have  bread  and  meat  in 
abundance  upon  his  table,  but  is  often  in  process  of  acquiring, 
and  that  without  long  delay,  the  earth  he  cultivates.  His 
happy  lot  has  nothing  in  common  with  that  of  the  Russian 
peasant,  the  veritable  serf  of  the  soil,  who  never  gets  so  far 
as  to  eat  the  smallest  crumb  of  the  wheat  he  has  harvested. 

The  one  labours  under  a  soft,  benign  sky,  which  does 
not  expose  him  to  the  rigour  of  extreme  temperatures  in 
an  atmosphere  of  freedom  and  brotherhood  which  make 
for  energy,  while  the  other  labours  at  his  furrow  in  a  severe 
and  unequal  climate,  and  under  a  system  of  political  oppression 
which   crushes   his   individuality  and    diminishes  the   value 


158    THE  ARGENTINE  IN  THE  20th  CENTURY 

of  his  efforts.  A  comparison  between  the  social  and  economic 
conditions  of  agriculture  in  the  two  countries  inclines  us  to 
conclude,  without  prejudice,  that  Russia  cannot  be  considered 
a  dangerous  rival  to  the  Argentine  or  the  markets  of  the 
world. 

The  Republic  'of  the  United  States  of  America  is  in- 
contestably  the  first  wheat-growing  country  in  the  whole 
world ;  and  it  is  interesting  to  consider  whether  this  country, 
which  is  also  the  greatest  exporter  of  wheat,  will  remain 
in  the  future,  in  spite  of  the  growth  of  internal  consump- 
tion, a  formidable  rival  to  the  Argentine  in  the  markets  of 
the  world. 

Let  us  first  of  all  consider  what  great  progress  there 
has  already  been  in  the  production  of  wheat  in  the  United 
States. 


Year. 

Population. 

Production. 

Proportion  Exported. 

(in  Millions  of  Bushels.) 

Per  cent. 

1877     ... 

46,35.3,000 

280 

25-6 

1882     ... 

52,495,000 

373 

31-8 

1886     ... 

57,404,000 

346 

26-6 

1891     ... 

63,844,000 

386 

26-6 

1894     ... 

67,692,000 

383 

41-5 

1897     ... 

71,592,000 

414 

33-9 

1901     ... 

77,647,000 

506 

41-36 

1904     ... 

— 

533 

— 

1905     ... 

— 

645 

— 

1906     .^ 

84,216,433 

669 

26-6 

1907     ... 

— 

621 

24  1 

In  the  United  States  the  area  under  wheat  has  consider-  ■ 
ably  increased,  but  the  yield  per  acre  has  steadily  decreased,  j 
Thus  we  find  that  in  1875  the  yield  was  12-3  bushels  per  acre ;  '' 
17  bushels  per  acre  in  1879  ;  11-7  in  1883  ;  149  in  1892 ;  13-4 
in  1899  ;  105  in  1902  ;  10  in  1903  ;  and  13-6  in  1904.     Thus 
in  spite   of   the  increased   yield,  the   results  per  acre  have 
not  increased,  and  the  average  of   1904  is  inferior  to  that 
of  1879 ;  while  in  France  the  average  yield  has  been  one  of 
20  bushels  per  acre  from  1900  to  1904. 

The  national  census  of  the  United  States  for  1900  contains 
a  graphic  chart,  which  represents  the  average  yield ;  from 
which  we  find  that  only  in  the  north-west,  certain  districts 
of  the  west,  and  in  a  portion  of  the  States  of  Washington, 
Oregon,  and   California   has    the   production   equalled    this 


Wheat  Exported. 

Price. 

(Millions  of  Dushels.) 

(Per  Bushel  on  the  Dock.) 

145 

58.  5id. 

218 

58.  3d. 

210 

6s.  Od. 

2U 

3s.   lOfd. 

209 

38.  8|d. 

227 

3b.   lljd. 

THE  PRODUCTION  OF  WHEAT  159 

maximum  of  20  bushels  per  acre  ;  in  mo.st  other  localities, 
which  afford  the  vast  majority  of  cases,  the  yield  has 
varied  between  8*5  and  15'6  gallons  per  acre. 

Having  glanced  at  the  production  of  the  United  States, 
we  must  inquire  whether  this  great  nation  is  increasing  its 
exportation  of  wheat  proportionately,  and  how  far  such  ex- 
portation may  prove  an  obstacle  to  the  development  of  the 
Argentine. 

The  following  figures  representing  the  years  of  tlie 
largest  export  of  wheat,  will  throw  light  upon  this  matter. 

Years. 

1879 
1892 
1898 
1899 
1901 
1902 

We  see  that  in  spite  of  the  European  alarmists,  who  in 
1876  denounced  the  "  American  Wheat  Peril,"  it  took  fourteen 
years  for  the  exports  to  increase  from  145  to  218  millions 
of  bushels,  and  that  the  latter  figure  has  been  only  four 
times  surpassed  since  1892. 

The  production  of  wheat,  on  the  other  hand,  increased  116 
per  cent,  between  1875  and  1903,  while  the  population,  during 
the  same  period,  increased  only  by  82  per  cent.  But  we  must 
not  forget  that  although  the  increase  in  population  is  constant, 
that  of  production  is  not — indeed,  the  harvest  of  1901  amounted 
to  only  273  million  bushels  of  wheat,  as  compared  to  280 
millions  in  1877.  There  is  a  decrease  in  years  of  bad  harvests, 
but  the  population  naturally  knows  no  such  decrease. 

The  consumption  of  wheat  did  not  increase  between 
the  census  of  1890  and  that  of  1900;  the  average  remained 
424-6  lb.  per  head,  representing  a  deficit  of  368-8  lb.  below  the 
standard  allowance  of  793-4  lb. 

On  the  other  hand,  as  the  population  increases  by  about 
1^  or  1^  millions  per  annum,  while  consumption  remains 
stationary,  we  may  conclude  that  if  this  country  has  not  yet 
reached  its  maximum  of  wheat-production,  it  is  very  near 
that  stage,  and  that  the  moment  is  approaching  at  which  all 


160    THE  ARGENTINE  IN  THE  20th  CENTURY 

its  wheat  harvest  will  be  absorbed  by  internal  consumption, 
to  the  detriment  of  the  export  trade. 

We  have  mentioned  India  as  a  wheat-exporting  country ; 
but  it  is  no  longer  a  rival  to  the  Argentine  in  the  conquest 
of  the  international  markets.  Here  is  the  comparative  table 
of  exportation  from  India  and  the  Argentine. 


Years. 

India. 

The  Argentine. 

(Millions  of  Bushtls.) 

(Mini 

ons  of  Bushels.) 

1891-2 

54-5 

:54-2 

1900-1 

•9 

36 -8 

1902-3 

18-5 

60-0 

1905-(! 

267 

109-0 

190(J-7 

28-9 

106-8 

A  mere  glance  at  these  figures  is  more  eloquent  than  any 
commentary,  since  the  exportation  of  wheat  from  India 
increased  by  barely  10,000,000  bushels  between  1902  and 
1907,  while  that  from  the  Argentine  increased  by  46,000,000 
bushels.  On  the  other  hand,  it  is  known  that  India  exports 
only  10  per  cent,  of  her  harvest,  although  her  extremely 
frugal  population  consumes  only  1"26  lb.  of  wheat  per  head, 
instead  of  the  793"4  lb.  we  have  taken  as  our  basis  of  annual 
consumption.  We  see  then  that  the  production  of  India,  if 
her  population  consumed  a  normal  amount  of  wheat,*  would 
not  satisfy  the  national  requirements,  so  that  far  from 
exporting  wheat  she  would,  on  the  contrary,  be  forced  to 
import  large  quantities  from  without. 

Canada  is  among  those  wheat-growing  countries  whose 
competition  is  most  to  be  feared  ;  and  this  for  many  reasons 
— geographical,  political  and  economical.  If  Argentine 
statesmen  do  not  seriously  apply  themselves  to  attracting  a 
foreign  population,  and  to  reducing  the  expenses  which  press 
upon  the  inhabitants,  the  Argentine  will  run  the  risk  of 
being  supplanted  in  the  future  by  this  important  British  colony. 

Canada,  from  many  points  of  view,  presents  a  singular 
analogy  to  the  Argentine  Pampas.  Like  the  latter,  it  is  an 
almost  desert  country,  its  area  being  3,190,000  square  miles 
(nearly  2  millions  more  than  the  Argentine),  with  a  popula- 
tion of  5,371,000,  or  slightly  less  than  that  of  the  Argentine; 
and   like   the   latter,   Canada   is   a   country   in    process    of 

*  There  is  really  no  Buch  thing  as  a  normal  consumption  of  wheat,  especially 
for  India.  The  amount  consumed  is  a  matter  of  climate,  local  or  national 
foodstuffs,  fuel,  methods  of  cooking,  etc. — [Trans.] 


THE  PRODUCTION  OF  WHEAT  161 

formation.  A  similarity  which  completCvS  the  comjiarison  is 
that  the  exports  of  Canada  consist  principally  of  the  products 
of  agriculture  and  stock-raising.  Her  principal  client  for 
wheat  is  England  ;  in  1906-1907  the  harvest  was  84,470,000 
bushels,  and  41,033,000  bushels  were  exported  ;  or  almost 
exactly  half. 

Here  we  should  remark  that  the  Canadian  Government 
is  making  every  effort  to  increase  the  population,  and  spares 
no  pains  to  attain  its  object.  In  contrast  to  what  has  been 
done  in  the  Argentine,  where  the  public  lands  have  only 
served  to  form  latifundm,  and  to  enrich  a  few  individuals, 
the  soil  in  Canada  is  sold  by  the  aid  of  accurate  maps,  which 
are  accompanied  by  a  mass  of  information  upon  questions 
that  may  interest  prospective  colonists ;  more,  the  purchaser 
is  given  all  kinds  of  facilities  for  payment,  as  well  as  for 
meeting  the  first  expenses  of  installation.  Thanks  to  a 
rational  and  active  propaganda,  immigration  is  abundant ; 
the  figures  for  1903  were  128,364,  compared  with  112,671  in 
the  case  of  the  Argentine.  Finally,  Canada  contains  19,500 
miles  of  railways,  as  against  13,600  in  the  Argentine. 

From  the  foregoing  data  we  may  conclude  that  the 
countries  capable  of  exporting  wheat  are  far  from  numerous, 
and  that  the  area  sown  with  cereals  throughout  the  world  is 
comparatively  small.  Hitherto  wheat  has  been  grown  on  an 
extensive  scale  in  the  United  States,  Russia,  and  India  ;  the 
agriculturalist  demands  everything  of  the  soil  and  gives  it 
nothing,  so  that  the  alternative  will  soon  arise  of  losing  the 
harvest,  or  of  restoring  fertility  to  exhausted  soils,  by  means 
of  costly  manures  which  will  absorb  enormous  sums.  Then 
the  legend  of  new  countries  will  have  had  its  day. 

To  resume  :  there  exists  an  enormous  discrepancy  between 
the  needs  of  the  consumer  and  the  production  of  wheat ; 
and  the  Argentine  Republic,  thanks  to  a  concatination  of 
favourable  economic  and  physical  circumstances,  is  certainly 
in  the  best  position  in  a  great  measure  to  supply  this  deficiency. 
But  to  obtain  the  desired  result  it  is  indispensable  that  she 
should  still  increase  her  population,  and  that  the  colonist 
should  find  upon  the  hospitable  Argentine  soil  not  only  the 
guarantees  of  liberty  and  justice,  but  conditions  propitious 
to  his  evolution  as  a  land-owner. 


CHAPTER  III 


STOCK-RAISING 


The  transformation  of  the  old  ' '  estancia  " — The  principal  stock-raising  establish- 
ments :  description,  extent,  number  of  heads  of  cattle  and  favourite  breeds — 
The  great  "  estancias  "  of  the  South  and  Patagonia. 

Approximate  area  of  the  soil  devoted  to  cattle  and  sheep ;  general  estimate  of 
the  numbers  of  cattle  and  sheep — Results  of  the  census  of  1908 — The 
capital  represented  by  Argentine  stock-raising. 

HAVING  spoken  of  agriculture  and  its  future,  we  must 
mention  another  industry,  which  is  the  second  source 
of  national  wealth — the  pastoral  industry. 

As  a  result  of  the  rapid  rise  in  the  value  of  land,  and  the 
multiplication  and  selection  of  animals,  the  old  form  of 
Argentine  stock-raising  is  undergoing,  at  the  present  time,  a 
profound  modification  throughout  the  country.  The  tradi- 
tional ranch  or  estancia,  on  which  the  animals  browsed  at 
will  on  vast  prairies  enclosed  by  wire  fences,  exposed  to  all 
the  variations  of  the  weather  and  all  the  vicissitudes  of  the 
temperature,  feeding  only  on  the  grass  of  their  pastures. 
This  old  type  of  estancia  is  gradually  disappearing  ;  is  under- 
going a  transformation  into  carefully-managed  farms,  on 
which  artificial  prairies  are  constructed ;  farms  with  lucerne 
fields  of  12,000,  25,000  or  50,000  acres,  surfaces  difficult  for  a 
European  to  conceive.* 

The  science  of  pedigree  herds  and  the  culture  of  care- 
fully-enclosed pastures  have  created,  says  a  distinguished 
writer,  the  true  pastoral  industry,  in  which  stables  and  barns 
and  sheds  take  the  place  of  the  ancient  "  corral."  t  The 
wealthy  owner  drives  from  tlje  railway  station  to  his  estancia 

*  A  field  of  12,000  acres  would  be,  for  instance,  4  miles  wide  and  orer 
4^  miles  long  ;  one  of  25,000  acres,  6  miles  -wide  and  6^  miles  long ;  one  of 
50,000  acres,  7  miles  wide  and  11  miles  long. — [Trans.] 

t  Cf.  Costtunbres  y  Creencins  populares  de  las  P7-ovi7icias  Argentines:  A 
lecture  by  M.  P.  Groussac  at  the  World's  Congress  at  Chicago,  June  the  4th, 
1893 ;  published  in  La  Nadon  of  the  23rd  of  October  1893. 

162 


STOCK-RAISING  163 

in  a  carriage  ;  the  old  rustic  ranch-house  is  transformed  into 
a  true  country-house,  sometimes  a  veritable  chdteav ,  v^ith  s, 
park  and  gardens.  There  are  estancias  within  a  hundred 
leagues  of  Buenos  Ayres  which  we  remember  as  desert 
country  in  the  power  of  the  Indians,  where  now  traps  and 
carriages  of  English  type  are  seen  crossing  the  plains,  where 
folk  dine  in  evening  dress  in  luxurious  homes.  The  European 
stock-breeders  have  driven  back  the  Guacho  to  the  great 
estates  on  the  borders  of  the  desert. 

Nothing  would  be  more  difficult — and  for  our  part  we 
renounce  the  task — than  to  say  which  are  the  first  stock- 
raising  establishments  of  the  Republic  ;  whether  by  reason  of 
their  extent,  the  numbers  and  the  breed  of  their  animals,  or 
the  magnificent  dwellings  of  their  owners.  Establishments 
of  this  type  are  to  be  counted  by  hundreds,  by  thousands. 

Nevertheless — though  exposed  to  the  danger  of  falling 
into  inevitable  errors  or  omissions,  for  lack  of  precise  informa- 
tion— we  must  not  forget  to  mention  the  Estancia  San 
Juan,  founded  by  Senor  Leonard  Pereyra,  at  a  distance  of 
25  miles  from  Buenos  Ayres,  and  a  mile  and  a  half  from  the 
La  Plata,  and  consisting  of  over  40  square  miles  of  meadows 
in  full  luxuriance.  Then  there  is  the  Estancia  San  Jacinto, 
belonging  to  Senor  Hugel  T,  de  Alvear,  an  establishment 
reputed  as  one  of  the  foremost  in  the  country,  which  embraces 
an  area  of  244  square  miles,  or  about  one-third  the  area 
of  the  county  of  Surrey.  Of  this  enormous  area  some  64 
square  miles  are  under  lucerne,  and  support  100,000  Durham 
cattle,  100,000  Lincoln  sheep,  and  10,000  horses. 

The  Estancia  la  Gloria  of  Santamarina  &  Sons,  situated 
at  Laprida,  in  the  Province  of  Buenos  Ayres,  comprises  145 
square  miles,  and  supports  20,000  cattle  and  60,000  sheep. 

Another  establishment,  which  might  be  taken  as  a  model, 
is  the  Estancia  San  Martin,  the  property  of  Senor  Vincent 
L.  Casares,  which  is  situated  at  Cafiuelas,  and  covers  an 
area  of  some  30  square  miles.  The  specialities  of  this  estab- 
lishment are  the  breeding  of  draught-horses  —  Morgans, 
Hackneys,  Shires  and  Clydesdales ;  the  breeding  of  cattle — 
Durharas,  Holsteins  and  Swiss — of  which  the  finest  individuals 
are  kept  for  breeding,  and  the  second-grade  animals  fattened 
for  export ;  the  keeping  and  selling  of   bulls   of   the  three 


164    THE  ARGENTINE  IN  THE  20th  CENTURY 

varieties  named  for  general  breeding  purposes;  and  finally 
the  breeding  of  pedigree  rams  of  the  Lincoln  and  Negrete 
breeds,  and  also  of  pure  cross-breeds  and  of  pure-blooded 
Yorkshire  pigs.  The  horses  from  this  estancia  have  a 
merited  fame  throughout  the  Argentine,  and  are  even  begin- 
ning to  be  known  abroad. 

A  portion  also  of  this  estancia  is  an  establishment  known 
as  La  Martina,  which  alone  supplies  three-quarters  of  the 
milk  consumed  in  Buenos  Ayres,  and  which  also  manufactures 
butter  for  home  consumption  and  for  export. 

Another  of  the  great  stock-raising  establishments  of  the 
Republic  is  the  Sefior  Carlos  Casares'  Estancia  Huetel,  about 
150  miles  from  Buenos  Ayres,  on  the  Southern  Railway.  It 
occupies  an  area  of  some  240  square  miles,  all  enclosed  by 
wire  fencing,  and  divided  into  forty-two  stock-raising 
establishments,  with  fifty-seven  shepherds'  houses  and  five 
managers'  houses.  This  establishment  contains  about  62,000 
Durham  cattle,  87,000  Lincoln  sheep,  with  pedigree  rams, 
imported  or  born  on  the  estancia,  and  4200  Clydesdale  horses, 
draught-horses  and  saddle-horses.  About  11,000  acres  are 
sown  with  lucerne,  and  5000  with  maize,  wheat,  oats  and 
linseed.  There  are  fifty-six  or  more  imported  bulls,  and 
notably  one  of  the  finest  of  his  race,  the  celebrated  Aguinaldo, 
winner  of  the  first  prize  awarded  by  the  Agricultural  Society. 

The  park  of  this  estancia  draws  the  attention  of  visitors ; 
it  is  500  acres  in  extent,  and  contains  some  520,000  forest 
trees,  870,000  shrubs,  and  35,000  young  trees.  The  total 
number  of  trees  on  the  estate  is  over  2  millions. 

There  is  a  school  on  the  estate,  all  the  expenses  of  which 
are  paid  by  the  proprietor. 

The  Estancia  San  Jacinto,  owned  by  Seilor  Saturnin 
J.  Unzue,  also  merits  a  special  description.  It  is  a  few  hours 
distant  from  Buenos  Ayres,  and  covers  an  area  of  some 
55  square  miles.  It  supports  10,000  cattle  and  30,000  sheep. 
On  this  estancia  the  Durhams  have  been  brought  to  a  great 
pitch  of  perfection.  The  stud  is  famous  for  its  saddle-horses, 
and  contains  140  pedigree  animals,  imported  or  born  in  the 
country. 

Las  Palmas,  belonging  to  Colonel  Alfred  T.  Urquiza, 
would  figure  as  a  model  establishment  in  any  country  in  the 


STOCK-RAISING  165 

world.  In  the  Province  of  Buenos  Ayrea,  in  which  it  is 
situated,  it  would  be  difficult  to  find  a  pedigree  stock-raising 
establishment  so  well  organised,  and  so  well  adapted  to  its 
purpose.  The  estate  consists  of  some  4000  acres,  overlooking 
the  majestic  Parana  de  les  Palmas,  with  its  green  islands, 
which  reach  as  far  as  the  Rio  de  la  Plata.  Here  about  3000 
beasts  are  annually  fattened  for  export.  The  cattle  are  short- 
horns, and  the  horses  Hackneys. 

Yet  another  establishment,  which  must  be  reckoned  one 
of  the  best  in  the  Argentine,  is  the  Cahava  San  Gregorio, 
belonging  to  Senor  Gregorio  Villafaiie ;  an  Argentine  who 
in  strict  justice  ought  to  be  mentioned  as  one  of  the  first 
breeders  in  the  country,  on  account  of  the  intelligent  efibrts 
and  pecuniary  expenditure  devoted  by  him  to  improving  the 
breeds  of  cattle,  sheep,  and  horses,  during  many  years  of 
personal  labour. 

Senor  Villafane's  establishment  is  not  of  very  great 
extent,  its  area  being  only  18,000  acres,  but  is  notable  for 
the  great  number  of  its  pedigree  cattle  and  the  purity  of 
type  to  be  observed  in  his  sheep.  He  devotes  himself  chiefly 
to  breeding  Durham  and  Hereford  bulls,  Lincoln  rams. 
Hackney  and  Clydesdale  stallions,  collie  ^dogs,  fox-terriers, 
Brahmah  fowls,  Catalans,  Dorkings,  and  Plymouth  Rocks. 

We  must  also  mention  the  Estancia  San  Paacual  del 
Moro,  the  property  of  Senors  Adolfo  and  Rufino  Luro.  It 
is  famous  for  its  stud  of  race-horses,  from  which  issued,  in 
1904,  the  great  winner  of  the  season.  Old  Man. 

This  long  list  of  breeding  estal)lishments  would  still  be 
incomplete  indeed,  did  we  fail  to  make  special  mention  of 
the  Estancia  Chapadmatal  of  SeiTor  M.-A.  Martinez  de 
Hoz,  who  has  made  the  greatest  efforts  to  raise  his  establish- 
ment to  the  level  of  the  best  European  models. 

"  Equal  to  the  best  in  Europe,"  was  the  judgment  of  a 
competent  and  impartial  observer,  Colonel  Holdich,  who,  in 
his  last  book,  entitled  Los  Paises  del  Fallo  del  Rey,  bestows 
upon  it  this  well-merited  praise  : — 

"A  well-known  estancia,  that  of  Senor  Michel-Alfred 
Martinez  de  Hoz,  near  the  Mar  del  Plata,  surprised  me  by 
the  singular  character  of  its  surroundings.  The  soil,  with 
its  irregularities,  had  the  look  of  an  English  park.     Little 


166    THE  ARGENTINE  IN  THE  20th  CENTURY 

hills  and  knolls,  one  after  another,  stretched  away,  covered 
with  their  golden  harvest,  with  soft  undulations,  to  the 
precipitous  borders  of  the  sea ;  instead  of  the  eternal  barbed- 
wire  fence,  living  hedges  were  already  springing  up, 
dividing  the  fields  and  the  pastures.  On  the  highest  hillocks 
rose  stacks  of  oats,  carried  up  from  the  fields  in  the  high- 
wheeled  wagons  characteristic  of  the  country-side ;  and 
there  the  stacks  were  being  rapidly  built  by  hand-labour.  It 
was  a  beautiful  rustic  scene. 

"  Lower  to  the  right,  on  the  softer  soil  by  the  banks  of 
a  stream,  which  descended  babbling  to  the  sea,  through 
beds  of  rushes  and  buttercups,  was  a  pasture ;  here,  standing 
in  the  branches  of  the  bank,  were  the  Shire  horses ;  they 
formed  animated  groups,  and  placidly  watched  our  move- 
ments ;  they  were  the  most  magnificent  examples  to  be 
found  out  of  Lincolnshire.  Further  down  still,  on  drier  soil, 
was  a  troop  of  mares,  of  an  English-Creole  cross,  with  their 
foals.  These  animals  were  for  draught,  and  the  excellence  of 
their  breeding  is  proved  by  the  registers  of  the  Argentine 
Rural  Society,  which  record  the  prizes  awarded  to  the 
Estancia  Chapadmatal. 

"  In  a  higher  part  of  the  estate,  in  a  quarter  reached 
through  long  avenues  of  poplars,  which  lead  thither  from 
the  house,  and  where  the  ground  is  covered  with  forests  oj 
eucalyptus  or  willows,  are  the  bulls  and  cows.  The  Argentim 
stock-breeder  does  not  consider  expense  when  it  is  a  mattei 
of  importing  good  English  cattle  for  breeding  purposes 
The  chief  estancia  has  a  series  of  breeding  bulls,  which  an 
led  before  the  visitor,  each  by  his  special  keeper,  with  th 
same  pomp  and  ceremony  aa  the  stallions  which  preced 
them  in  the  brilliant  review.  It  is  not  only  near  the  capita 
and  the  principal  centres  of  population  that  we  find  thes 
model  estancias,  which  afford  their  owners  every  Europea 
comfort.  They  are  to  be  found  also  in  the  extreme  sout 
of  the  country,  in  the  solitudes  of  Patagonia,  near  the  50t 
degree  of  south  latitude."  * 

"  From  the  River  Coyle,  from  Puerto  Gallegos  an 
Magellan  Straits,  to  a  point  near  Last  Hope,"  says  a 
Argentine  traveller,  Mr  George  J.  M'Lean,  who  visited  the.' 

*  Cf.  Annates  de  la  Sociedad  Rural  Argentina,  No.  4,  30th  April  1902,  p.  1£ 


STOCK-RAISING  167 

regions  a  few  years  ago,  "  the  country  is  fairly  peopled,  and 
one  comes  across  estancias,  such  as  El  Condor,  the  property 
of  Messrs  Wood  &  Waldron,  an  establishment  of  337,500 
acres,  with  a  wire-fenced  enclosure  containing  160,000  sheep, 
equipped  with  forty  steam  shearers,  with  hydraulic  presses, 
and  sheep-dips  warmed  by  steam  calorifers.  It  is  a  common 
thing  to  lind  estancias,  many  of  which  are  fenced  with  wire, 
feeding  40,000,  60,000  or  70,000  sheep.  The  most  important 
are  united  .by  telephone,  by  which  means  they  communicate 
not  only  with  each  other,  but  with  Puerto  Gallegos  or  Punta 
Arenas.  I  have  spoken  down  these  over  a  distance  of  300 
miles.  In  the  Chilian  portion  of  Tierra  del  Fuego,  there  is 
a  telephone  connecting  Cape  Dungeness  with  Punta  Arenas, 
and  also  to  the  channels  of  Last  Hope." 

In  the  Territory  of  Santa  Cruz  is  the  Estancia  San 
Julian,  belonging  to  the  San  Julian  Sheep  Company.  This 
"  estancia  "  has  an  area  of  296,000  acres — 462*5  square  miles — 
and  contains  70,000  sheep,  with  an  annual  yield  of  90  per 
cent,  of  lambs,  or  63,000. 

In  the  same  Territory  is  another  very  prominent  estancia, 
the  property  of  the  Patagonian  Sheep  and  Farming  Com- 
pany Limited.  This  embraces  an  area  of  471,000  acres — 
734  square  miles — the  area  of  a  medium  -  sized  English 
county. 

Finally,  in  the  same  Territory  is  a  vast  property  of 
700,000  acres — 1060  square  miles — belonging  to  the  Bank 
of  Antwerp. 

In  the  Territory  of  Chubut,  which  for  some  years  has 
been  a  favourite  locality  for  European  capital  and  European 
immigrants,  and  which  contains  a  large  French  colony,  there 
is  a  very  important  estancia  belonging  to  the  Lochiel  Sheep 
Farming  Company  Limited,  which  covers  an  area  of  327,000 
acres,  and  contains  35,000  sheep. 

Another  foreign  company  established  in  the  southern 
part  of  the  Argentine,  "  The  Argentine  Southern  Land  Com- 
pany," possesses  1,518,000  acres  of  land,  of  which  859,000  are 
in  the  Territory  of  Rio  Negro,  and  659,000  in  that  of  Chubut. 
This  company  was  established  in  1899,  with  a  capital  of 
£230,000,  later  reduced,  on  account  of  business  misfortunes, 
to   £140,000,  which   is   the   present  capital.     On  this  com- 


168    THE  ARGENTINE  IN  THE  20th  CENTURY 

pany's  lands  are  45,000  cattle,  40,000  shee}>,  and  4300 
horses. 

lu  all  these  establishments,  and  in  many  others  which  we 
are  unable  to  cite,  as  it  is  difficult  to  obtain  precise  informa- 
tion concerning  them,  we  find  that,  thanks  to  the  intelligent 
efforts  of  their  owners  in  seeking  to  import  the  best  breeds 
of  the  most  famous  European  breeding  establishments,  there 
are  now  many  stallions,  bulls,  and  rams  of  the  purest  blood 
and  of  great  value,  which  are  either  imported  or  selected ; 
and  through  these  the  general  stock  of  the  country  has 
reached  a  very  high  quality  of  race. 

All  stock-breeders,  even  the  smallest,  are  aware  today  of 
the  great  advantages  to  be  obtained  by  crossing  selected 
animals  with  sires  of  pure  blood,  and  the  result  has  been  a 
great  advance  in  the  stock-raising  industry.  The  statistics 
of  importation  show  that  in  nine  years,  from  1899  to 
1907,  plus  eleven  months  of  1908,  there  have  entered  the 
country  from  England,  where  the  Argentine  breeder  usually 
seeks  his  stud  animals,  10,040  bulls  and  cows,  and  35,094 
sheep.  These  two  figures  alone  show  the  importance  which 
the  Argentine  breeder  attaches  to  the  improvement  of  the 
breed  of  his  flocks  and  herds.  The  prices  paid  for  these 
animals  are  sometimes  extravagant ;  in  one  case  £3520  was 
paid  for  a  bull  ;  but  land-owners  willingly  pay  such  sums  in 
the  certainty  that  such  sires  will  bring  them  considerable 
profits. 

The  area  at  the  disposal  of  the  Argentine  stock-raiser  is 
still  practically  unlimited.  We  need  only  remember  that  of 
the  750  millions  of  acres  which  roughlj'^  represent  the  area 
of  the  Argentine  soil,  one-half,  or  some  375  millions  of  acres, 
are  adapted  to  stock-raising. 

Of  this  enormous  area  some  185  millions  might  be  sown 
at  once  with  cereals  and  fodder,  notably  in  the  coast 
Provinces,  in  Cordoba,  and  the  Pampa,  and  there  remains  as 
much  more  for  stock-raising,  without  taking  into  account 
the  millions  of  animals  that  might  be  nourished  by  intensive 
culture  in  the  cultivated  zone.  This  extension  would  allow 
of  the  existence  of  40  million  cattle  and  200  million 
sheep. 


STOCK-RAISING  ir.O 


Results  of  the  Census  of  Stock  taken  in  1908. 

What  is  the  amount  of  stock  at  present  in  the  Argentine 
Republic  ?  We  are  in  a  position  to  answer  this  question, 
one  of  the  present  writers,  Senor  A.  B.  Martinez,  having 
been  appointed  Director  of  the  last  agricultural  and  pastoral 
census,  which  was  taken  during  the  first  fortniglit  of  May 
1908,  according  to  a  law  passed  by  Congress.  The  work 
which  sums  up  the  results  of  this  important  undertaking  is 
in  three  volumes,  and  is  at  present  in  the  jiress;  thanks  to 
which  fortunate  circumstance  we  are  able  to  anticipate  its 
publication,  and  to  give  our  readers  the  benefit  of  this  in- 
vestigation. 

The  census  of  agriculture  and  stock-raising,  undertaken 
over  the  entire  territory  of  the  Republic,  has  revealed 
the  existence  in  Argentine  territory  of  29,110,625  cattle, 
7,581,376  horses,  465,037  mules,  285,000  asses,  67,211,754 
sheep,  3,945,086  goats  and  1,403,591  swine. 

If  we  compare  these  results  with  those  of  the  two  previous 
censuses,  that  of  1888  and  that  of  1895,  we  obtain  the  follow- 
ing table : — 


Census. 

Cattle. 

Horses. 

Sheep. 

Swine. 

1888    ... 

2i,9(;:i,n;?o 

4,262,917 

66,701,097 

40:i,2O:J 

189.5    ... 

•ii,70i,:$2(; 

4,445,859 

74,379,562 

652,766 

1908    .. 

29,11G,G25 

7,531,376 

67,211,754 

1,403,591 

We  see  from  these  figures  that  in  twenty  years,  between 
I  1888  and  1908,  the  number  of  cattle  has  increased  by 
1 7,152,695  head  ;  and  in  thirteen  years,  between  1895  and  1908, 
I  by  7,415,099  head.  The  number  of  horses  has  increased  by 
'  3,268,459  between  1888  and  1908,  and  by  3,085,517  between 
i  1895  and  1908.  Sheep  have  increased  by  510,657  between 
I  1888  and  1908,  but  decreased  by  7,167,808  betAveen  1895 
I  and  1908.  Swine,  far  from  numerous  if  we  compare  their 
!  numbers  with  these  obtained  from  other  countries,  present 
I  a  continual  increase:  1,000,388  between  1888  and  1908, 
I  and  750,825  between  1895  and  1908. 

The  decrease  of  7.000,000  in  the  numbers  of  sheep  in 
thirteen  years  is  in  keeping  with  what  has  been  observed  in 
the  principal  wool-producing  countries.    Authorities  assure  us 


170    THE  ARGENTINE  IN  THE  20th  CENTURY 

that  of  the  400  millions  of  sheep  which  existed  in  various 
parts  of  the  world  in  1873,  there  remain  to-day  barely 
300  millions.  In  Germany,  for  instance,  to  go  by  the 
Journal  des  ^conomistes,  the  number  of  sheep  has  dropped 
from  19  millions  to  7  millions  in  a  space  of  twenty-five 
years. 

The  causes  of  this  constant  diminution  are  numerous. 
First  of  all  we  will  take  the  development  of  agriculture, 
which  has  expelled  the  sheep.  According  to  an  eminent 
collaborator  in  the  census,  "The  sheep  has  to  walk,  must 
walk  far  and  wide,  must  walk  always,  in  order  to  eat 
sufficiently — unless  he  does  so,  his  food  will  be  too  costly ;  he 
is  essentially  a  vagabond,  and  he  consequently  requires  a 
great  space  and  continual  supervision."  *  For  these  reasons 
the  European  small  farmer  prefers,  if  he  can,  to  keep 
one  or  two  cows  in  his  cow-shed  and  suppress  the  sheep 
entirely. 

Sheep-breeding  really  gives  encouraging  results  in 
regions  where  the  area  of  the  soil  and  the  prairies  is  out 
of  all  proportion  to  the  number  of  labourers  available  for  its 
culture.  Land  given  up  to  sheep  cannot  support  the  high 
rents  paid  by  the  producers  of  cereals ;  this  is  the  principal 
cause  of  the  decline  of  sheep  -  farming  all  the  world 
over.t 


♦  Probably  the  sheep  would  pay  better  if  kept  more  as  cattle  are  kept. 
The  theory  of  long  marches  only  applies  to  enormous  flocks,  so  thick  upon  the 
ground  that  they  must  walk  miles  a  day,  eating  all  the  time.  If  the  whole  herd 
of  sheep  on  a  large  sheep-farm  were  divided  into  many  small  flocks,  and  the 
farm  into,  say,  ten  times  as  many  pastures,  each  flock  might  be  turned  for  two 
days  into  each  pasture,  so  that  it  would  have  three  weeks'  growth  on  it  before 
the  flock  returned  :  or,  if  large  enough  to  feed  the  sheep  twenty  days,  it  would 
have  twenty  weeks  in  which  to  recover — time  to  grow  a  crop  of  leguminous 
fodder,  after  which  a  splendid  crop,  or  series  of  crops,  of  cereals  could  be  grown 
upon  it.  Under  such  a  system  the  sheep  would  wander  less,  fatten  quickly  and 
be  more  tender.  English  sheep-farming  is  on  an  infinitesimal  scale,  but  the 
profits  from  a  small  flock  changed  from  pasture  to  pasture  are  often  very  con- 
siderable.—[Teans.] 

t  Other  causes  are  :  the  invention  of  mixtures  of  cotton  and  wool ;  the  use 
of  silk  and  mercerised  cotton  :  and  the  production  of  cellular  or  netted  cotton 
and  linen  underclothing,  which  is  healthier  and  cheaper  than  wool,  and  equally 
warm  ;  also  the  improvement  of  wool-bearing  breeds,  through  which  fewer 
sheep  will  produce  the  same  quantity  of  wool.  The  export  of  cheap  beef  from 
America  is  another  active  factor. — [Tbans.] 


STOCK-RAISING  171 

The  following  table  gives  the  total  number  of  beasts  of 
various  kinds,  classed  according  to  purity  of  breed : — 


Species. 

Pure. 

Cross-bred. 

Native. 

Total. 

Cattle 

084,897 

13,060,446 

13,071,282 

29,116,625 

Horses 

49,0U0 

1,693,637 

5,788,739 

7,331,376 

Mules 

— 

— 

465,037 

465,037 

Asses 

— 

— 

285,088 

285,088 

Sheep 

1,179,482 

55,448,749 

10,583,523 

67,311,754 

Goats 

3,321 

129,800 

3,816,965 

3,945,086 

Swino 

34,462 

589,126 

780,003 

1,403,591 

In  the  matter  of  cross-breeding  the  Argentine  has  made 
.stonishing  progress,  the  proof  of  which  is  to  be  found  in 
he  comparison  of  the  figures  for  1895  with  those  of  1908. 
t  is  enough,  for  our  purpose,  to  mention  that  in  1895,  in  the 
'rovince  of  Buenos  Ayres,  out  of  100  cattle,  6  per  cent,  were  of 
>ure  blood  :  49  2  per  cent,  were  cross-bred,  and  50-2  per  cent, 
rere  of  native  breeds;  and  thatthirteenyears  later  these  figures 
s^ere  transformed  into  6*2  per  cent,  of  pure  blood,  85*1  percent, 
f  cross-bred  cattle,  and  87  per  cent,  of  native  breeds.  This 
mprovement  in  the  Province  of  Buenos  Ayres  is  repeated  in 
he  other  more  productive  Provinces,  and  in  the  case  of  other 
pecies  of  animals. 

We  have  stated  that  the  number  of  cattle  in  the 
Lrgentine  Republic  is  over  29  millions;  this  number  may 
e  analysed,  according  to  sex,  age,  etc.,  in  the  following 
lanner : — 

Year  1908. 

Male  calves          3,820,443 

Heifers      3,611,412 

Bulls          886,450 

Bullocks 4,687,027 

Cows  for  breeding          12,825,904 

Milch  cows           2,163,900 

Oxen         1,221,489 

29,116,025 


I    It  now  remains   to   consider  the   value   of   the  animals 

!gistered  as  existing  in  the  Republic  in  the  year  of  census 

,:^08. 

!  In  1895  this  value  was  estimated  at  1,186,780,411  piastres 

i>aper),  which  with  the  exchange  at  300  percent,  was  equiva- 

,ntto  378,926,803  piastres  (or  dollars)  in  gold,  or  £75,785,360, 

la.,  while  the  latest  census  gives  a  value  of  1,481,282,245 


172    THE  ARGENTINE  IN  THE  20th  CENTURY 

piastres  in  paper,  which  with  exchange  at  2*27,  is  equivalent 
to  651,764,187  piastres  in  gold,  or  £130,352,835. 

If  now  we  analyse  these  figures,  dividing  them  among 
the  various  species  of  animals,  as  given  by  the  censuses  of 
1895  and  tliat  of  li^OS,  we  obtain  the  following  table : — 

Species.  1895.  1908. 

Cattle         £44,508,493         £82,604,353-4  ' 

Horses 

Mules 

Asses 

Sheep 

Goats 

Swine 


We  see  from  this  that,  in  spite  of  the  moderate  valuatio 
of  the  stock  in  1908,  its  value  had  increased,  in  thirteen  yean' 
by  nearly  £54,600,000. 

Knowing  the  numbers  and  the  value  of  the  live  stock  c' 
the  Argentine  Republic,  a  last  question  arises  of  the  highe.' 
interest.  What  place  does  tlie  Argentine  hold  among  thof 
nations  in  which  stock-raising  has  reached  its  highest  develoi 
ment  ? 

To  answer  these  questions,  we  have  resorted  to  the  mo 
authoritative  publications  available,  with  the  result  that  i- 
are  enabled  to  draw  up  the  following  table  : — 


5,099,281-4 

18,112,761-4 

066,150-6 

1,985,374-0 

131,914 

251,235 

24,525,101 

25,287,598-6 

389,139 

732,322 

405,272 

1,379,192 

£75,785,300 

£130,352,837 

Species. 

States. 

Cattle. 

Horses. 

Sheep. 

Swine.: 

The  Argentine  Republic     ... 

29,116,625 

7,531,376 

67,833,112 

l,403,i; 

The  United  States     

69,438,758 

21,216,888 

61,837,112 

04,694,:^; 

Canada 

5,376,451 

1,577,493 

2,510,239 

2,353,;  1 

Australia 

9,349,409 

1,765,186 

83,087.053 

813,1 

Cape  Colony  ... 

2,000,000 

300,000 

11,800,000 

400,'  1 

India,  Burmah,  E.  Indies,  etc. 

91,700,000 

1,300,000 

18,000,000 

— ' 

European  Russia      

39,000,000 

22,000,000 

42,900,000 

11,200,) 

Germany 

20,000,000 

4,300,000 

7,700,000 

22,100,3 

France             

14,000,000 

3,200,000 

17,500,000 

700,3 

Austria           

9,. 500, 000 

1,700,000 

2,000.000 

4,700,0 

Great  Britain             

7,000,000 

1,600,000 

25,400,000 

2,700,0 

This  table  shows  us  that,  in  the  matter  of  cattle,  e 
Argentine  Republic  holds  the  third  rank ;  it  is  also  in  e 
third  rank  in  the  matter  of  horses ;  in  the  second  rank  in'  e 


STOCK-RAISING  173 

matter  of  sheep ;  and  in  the  matter  of  swine  she  holds  one 
of  the  lowest  ranks. 

If  we  compare  the  Argentine  with  the  United  States  in 
particular,  the  contrast  is  strikinor;  while  in  North  America 
the  value  of  all  bestial  reaches  the  colossal  sum  of 
£664,800,000,  in  Argentina  it  amounts  only  to  £130,400,000, 
distributed  as  follows  : — 


Species. 
I   Cattle 

Horses 

Sheep 

Asses 

Mulos 

Swine 
^  Goats 

i        Consequently  the   Argentine  is  far  from   achieving   the 

j  wonderful  results  obtained  by  the  great  northern  Republic 

!  of  America;*  for  that  matter,  she  could  not  compare  with 

the  States,  having  only  6,000,000  inhabitants  to  the  latter's 

,  86,000,000 ;   and   her   wealth  is  equivalent  only  to  a  small 

!  fraction  of  the  colossal  wealth  of  the  States.    Yet  an  examina- 

j  tion  of   the  above  figures  is   encouraging,   for   in   view   of 

I  the  progress  accomplished  before   the  previous   census,   the 

Argentine  may  justly  regard  her  flocks  and  herds  with  pride, 

and   continue  to  increase  them,  thanks  to  her  climate,  the 

;  fertility  of  her  soil,  and  the  energy  of  her  inhabitants. 


United 

Argentine 

United 

Argentine 

States. 

Republic. 

States. 

Repul;lic. 

«0,438,758 

29,116,625 

£315,660,088 

£82,604,353 

I'l,  216,888 

7,531,376 

218,601,571 

18,112,761 

61,837,112 

67,211,754 

35,571,250 

25,287,598 

111,450 

285.088 

1,412,307 

251.235 

8,445,029 

465,037 

43,239,985 

1,985,374 

64,694,222 

1,403,581 

49,657,202 

1,379,192 

1,941),  005 

3,945,086 

707,865 

732,322 

*  It  must  bo  remembered  that  of  two  boasts  of  equal  purity  of  brood,  and  in 
perfect  condition,  the  Argentine  would  be  reckoned  as  being  of  the  lower  value. 
The  reason  of  this  is  economic  and  very  simple.  The  Argentine  bullock  is 
affected  by  competition  and  pays  tribute  to  the  breeder,  the  railway  company, 
the  refrigerating  company,  the  shipping  line,  the  European  buyer  or  salesman, 
and  the  retail  salesman.  Consequently  it  is  worth  less  in  the  Argentine  than  n 
the  States,  where  the  selling-price  is  artificially  inflated,  and  whore  the  valuo 
of  a  beast  to  the  breeder,  since  he  has  only  to  pay  freight  and  the  profit  of  a  largo 
company,  which  is  sometimes  the  breeder  and  the  railway  company  too,  is  natur- 
ally far  greater.  It  must  not  therefore  be  supposed  that  because  the  Argentine 
horse  or  bullock  is  cited  as  of  lower  value,  that  it  is  inferior.  Its  value  is  lower, 
juBt  as  good  land  in  the  Argentine  is  cheaper  than  in  New  York  State. — [TkaN8.] 


CHAPTER  IV 

THE  VALUE   OF   THE   SOIL 

Difficulties  in  estimating  this  value — Principal  factors  of  valuation — Examples 
taken  from  lucerne  fields  and  the  forests  of  quebracho — Despite  adverse 
circumstances,  and  with  a  few  exceptions,  there  has  always  been  a  tendency 
for  the  price  of  land  to  rise — Alienation  of  lands  acquired  by  conquest  from 
the  Indians  ;  their  enormous  present  value — The  rise  of  value  dates  from 
1902,  and  has  hitherto  continued  without  relapse — The  causes  of  this  rise, 
and  its  rational  principles,  according  to  an  authoritative  opinion. 

Examples  of  valuation  drawn  from  the  sales  of  public  lands — The  rise  of  prices 
in  the  Provinces  of  Buenos  Ayres,  Cdrdoba,  Santa  Fe,  and  the  Pampa, 
with  figures  indicating  the  prices  realised  in  some  large  recent  trans- 
actions. 

NOTHING  is  more  difficult  than  to  determine  the  value 
of  land  in  a  country  in  the  course  of  formation,  like 
the  Argentine  Republic,  in  which  it  undergoes  considerable 
increase  from  one  moment  to  another;  not  only  on  account; 
of  general  progress,  but  also  from  special  reasons,  such  as 
good  harvests,  the  construction  of  a  railroad,  etc.  In  the 
same  region,  in  the  same  district,  two  neighbouring  tracts 
will  often  have  a  different  value,  accordingly  as  they  have 
or  have  not  a  permanent  water-supply,  or  as  they  are  more  or 
less  adapted  to  agriculture,  nearer  to  or  further  from  a 
railway,  a  station,  or  a  centre  of  population. 

For  some  years  now,  two  new  factors  of  valuation  have 
come  into  being  :  the  culture  of  lucerne  and  the  planting  of 
quebracho  wood. 

Since  farmers  have  known  of  the  enormous — the  fabulous 
— profits  to  be  derived  from  fields  of  lucerne,  every  buyer  of 
land  inquires  first  of  all  if  there  is  water  available ;  that  is. 
if  the  subterranean  water-level  is  near  the  surface;  as  on 
that  factor  depends  the  existence  of  the  lucerne  pasture  foi 
many  years. 

If  upon  investigation  it  is  found  that  there  is  water 
the  land,  by  this  sole  fact,  acquires  an  enormous  value  ir 
comparison  to  what  it  would  be  worth  if  it  were  unfit  foi 

lucerne. 

174 


THE  VALUE  OF  THE  SOIL  175 

An  important  newspaper,  published  in  Buenos  Ayrcs  in 
the  English  tongue,  the  Standard,  has  shewn  that  the  price 
of  land  in  Victoria  (Australia),  where  the  acre  is  worth  from 
£4,  6s.  to  £9,  compared  to  the  prices  paid  for  land  in  the 
Argentine  suitable  for  sowing  lucerne  (that  is,  in  the  south 
of  Cordoba  and  San  Luis,  where  there  are  no  invasions  of 
rabbits,  where  there  is  no  drought,  and  which  are  half-way, 
so  to  speak,  to  the  European  markets)  proves,  by  comparison, 
the  low  value  of  Argentine  land.    Even  when  near  a  railway, 

:  such  lands  may  be  bought  for  I7s.  6d.  or  £1  per  acre. 

In  proof  of  the  above  affirmation,  the  Standard  has 
made  the  following  calculation  :  Let  us  suppose  an  expense 
of  6s.  5d.  per  acre  for  the  expenses  of  sowing  and 
cultivating  an  acre  of  soil  (including  sowing  it  with  lucerne 
at  £2  per  cwt.),  it  follows  that  the  acre  costs  from  £1,  3s.  to 
£1,  8s.,  and  the  square  league  of  6175  acres  (representing 
the  work  of  eighteen  months)  about  £7920.  Adding  £880 
for  fencing  and  watering,  we  find  the  price  of  the  square 
league  (9648  square  miles)  amounts  to  some  £8800. 

What,   according   to   the   Standard,   is  the  profit  to  be 

'  drawn  from  this  square  league  ?     It  will   fatten  some  4500 

:  head  of  three-year-old  cattle,  which  may  be  bought  at  £4,  88. 

•  per  head,  and  seven  months  later  sold  at  £7,  18s.  6d. ;  this 
will  give  a  profit  of  £3,  10s.  6d.  per  head,  or  a  gross  profit  of 
£15,862.     Deducting  £7040  *  for  expenses  (allowing  freight 

j  to  the  extent  of  10s.  6d.  per  head),  there  remains  a  net  profit 

i  of  £8800  per  league  per  annum,  or  100  per  cent,  on  the  outlay. 

'  If  such  are  the  results  to  be  obtained  from  the  transformation 

'  of  an  uncultivated  tract  of  land  into  a  lucerne  pasture,  it  is 
not  surprising  that  rural  property  is  so  quickly  attaining  so 
high  a  value. 

In  the  case  of  quebracho — a  very  hard  wood  which  is  use- 
ful for  building  and  constructive  purposes,  and  from  which 

I  an  excellent  tannin  can  be  obtained — matters  are  much  the 
same.  Having  had  experience  of  the  large  profits  to  be 
derived  from  the  manufacture  of  quebracho  extract,  and  the 

'■  splendid  dividends  paid  by  the  companies  engaged  in   the 

*  Apparently  made  up  of  half  the  cost  of  the  lucerne  pasture,  plus  freijfht 
and  labour  ;  as  two  sets  of  boasts  can  be  fattened  in  a  year  or  a  liitlo  over. — 
[Trans.] 


176    THE  ARGENTINE  IN  THE  20th  CENTURY 

work,  men  of  business,  anxious  to  invest  their  capital  to 
advantage,  hastened  to  acquire  forests  of  quebracho,  with 
the  result  that  the  price  of  such  land  suddenly  rose  to  a 
level  hitherto  undreamed  of.  Tracts  situated  in  the  Chaco — 
a  region  where  quebracho  abounds — which  were  selling  a 
year  previously  for  £88  the  square  league  of  9648  square 
miles,  rose  in  price  to  £880,  and  this  latter  price  can  by  no 
means  be  considered  as  a  definite  maximum. 

What  is  true  of  lucerne  and  quebracho  is  also,  though  on 
a  much  smaller  scale,  true  of  linseed  or  wheat,  when  after 
an  abundant  harvest  the  land-owner  or  farmer  procures  the 
requisite  capital  for  the  purchase  of  the  land  he  has  been 
cultivating  and  pays  a  good  price  for  it.  There  are  here 
elements  which  confound  all  calculations  made  in  advance, 
and  make  it  difficult  to  fix  even  an  approximate  value  on 
the  soil. 

At  the  present  moment  there  is  no  basis  for  such  a 
valuation.  A  farm  selling  to-day  at  20s.  per  acre,  may 
to-morrow  sell  for  26s.,  the  day  after  to-morrow  for  32s.,  and 
so  on,  until  prices  are  reached  which  astonish  the  first  vendor 
and  give  him  the  melancholy  conviction  that  he  did  ill  t( 
part  with  his  land.  For  this  reason,  the  best  thing  one  car 
do  to-day  is  to  hold  on  to  the  land. 

The  value  of  rural  and  urban  property  has  gone  oi 
increasing  more  and  more  rapidly  for  more  than  forty  years 
and  although  there  have  been  great  fluctuations  in  prices 
the  rise  has  always  been  constant  in  the  long  run  ;  owing  t 
the  increase  in  the  population,  the  consolidation  of  politics 
institutions,  the  construction  of  far-reaching  railway  system! 
the  prodigious  development  of  international  traffic,  and,  a 
a  natural  consequence,  the  great  increase  of  public  wealth. 

To  gain  an  idea  of  the  entire  significance  of  this  increas 
in  values,  we  must  go  back  to  the  more  than  modest  price 
of  rural  property  which  ruled  before  the  later  developmer 
of  the  upward  movement.  It  is  enough  to  recall  the  fa<'i 
that  in  1879,  with  the  object  of  procuring  funds  in  suppo)  T 
of  the  expedition  which  General  Roca  was  leading  againi 
the  Indians  of  the  wilderness,  an  expedition  which  resulte 
in  the  conquest  of  226,800  square  miles  of  territory,  tl: 
Government  oflfered  for  sale  an  enormous  tract  of  land  i 


THE  VALUE  OF  THE  SOIL  177 

the  price  of  £80  the  league  (about  £9  the  square  mile),  the 
purchase-money  to  be  payable  over  five  years.  But  the 
devaluation  of  these  lands  was  so  great,  and  faith  in  their 
remunerative  possibilities  so  inferior,  that  very  few  accepted 
the  offer.  Many  did  so  rather  as  a  patriotic  loan  than  as 
:  a  serious  investment.  Others  did  so  as  a  mark  of  personal 
deference  towards  the  men  who  were  at  the  head  of  the 
Government.  But  all  have  been  abundantly  rewarded,  since 
much  of  the  soil  which  they  were  able  to  obtain  at  £35  the 
league  is  selling  to-day  at  £26,000  and  £35,000.  More  than 
one  of  the  great  private  fortunes  in  the  country  had  no 
other  foundation  than  this. 

This  depreciation  of  rural  property  continued  still  un- 
changed for  a  dozen  years  ;  so  much  so,  that  in  order  to  tide 
,    over  the  crisis  before  the  crash  of  1890,  the  Government,  which 
so  disastrously  handled  the  affairs  of  the  nation,  liad  the  evil 
inspiration  to  offer  for  sale  in  Europe,  by  virtue  of  the  law 
of  October  the  15th,  1889,  those  very  24,000  leagues  of  land 
.   obtained    by   conquest   by  General  Roca's  expedition.     The 
:   sale  was  to  be  effected  at  the  figure  of  10  francs  per  hectare — 
;  about  3s.  3d.  per  acre  ! — payable  half  upon  purchase  and  hal 
1   at  the  end  of  two  years.     No  limit  was  set  to  the  powers 
of  purchase  of  any  one  buyer ;  each  could  buy  just  as  much 
,   as  his  purse  would  allow.     The   law,  in   palliation   of   this 
I  incredible  operation,*  promised  to  apply  the  whole  product 
i  of   the   sales   to   the  fund  for  converting  the  issue  of   the 
I  guaranteed    bank-notes    of    famous    memory.      Providence, 
I  happily,   which   more   than  once  has  taken   the  Argentine 
i  under    its    especial    protection,    prevented   this   disastrous 
I  alienation   of   territory   from    taking   place.      Had   it    been 
otherwise,  the  Republic  would  have  sold  for  a  mess  of  pottage 
I   a  magnificent  portion  of  her  territory,  a  country  large  enough 
j  to  house  more  than  one  European  nation,  and  which  to-day 
I  perhaps  would  be  in  the  hands  of  a  company  or  a  foreign 
i  government — a  new  state  within  the  State. 

The  depreciation  of  rural  property   continued  for  some 

*  It  must  be  remembered  that  this  tract  was  four  and  a  half  times  the  size 

of  England  ! — and  this  enormous  country,  in  the  heart  of  the  Argentine,  waa 

offered  for  sale  to  foreigners  !     The  process  of  buying  it  back  when  the  terrible 

'    folly  of  the  act  was  once  obvious,  would   have  been  oquivalont  to  making  the 

country  tributary  for  years,  and  for  enormous  sums,  to  Europe. — [Trans.] 


178    THE  ARGENTINE  IN  THE  20th  CENTURY 

years.  Thus,  in  1897,  the  Government  sold  by  tender  to  the 
highest  bidder  a  large  portion  of  its  best  lands,  at  the  price 
of  3750  piastres,  or  £330  the  square  league  (about  £36 
the  square  mile),  payable  in  five  years,  with  permission  to 
pay  in  bonds  of  the  patriotic  loan,  which  then  stood  at 
about  75  per  cent.* 

This  situation  continued  until  1902 — a  year  which  saw  the 
settlement  of  the  old  question  of  the  Chili- Argentine  frontier ; 
a  year  of  abundant  harvests  and  enormous  development  in 
the  stock-raising  world  ;  a  development  which  took  shape 
first  in  the  export  of  cattle  on  the  hoof  and  then  in  the 
despatch  of  great  quantities  of  chilled  or  frozen  meat  to 
the  English  markets ;  a  year  which  also  saw  the  advent  of 
a  financial  stability  resulting  from  the  "  law  of  monetary 
conversion,"  which  gave  a  fixed  value  to  paper  money,  the 
medium  of  all  commercial  transactions  in  the  interior.  Then 
came  a  steady  and  decisive  rise  in  the  value  of  landed 
property  in  general  and  of  rural  property  in  particular. 

Since  the  beginning  of  this  movement  the  value  of  the 
soil  has  steadily  increased ;  the  last  price  is  always  greater 
than  the  previous  one,  although  the  latter  may  have  appeared 
stationary,  if  not  final.  This  being  the  case,  we  ought  to 
ask  whether  this  general  rise  responds  to  permanent  and 
sufficient  causes,  or  if  it  is  only  the  result  of  capricious 
speculation,  afiecting  landed  property  now  as  at  another  time 
it  affected  paper  money. 

In  reply  to  this  question,  Senor  Roman  Bravo,  one  of 
those  Argentines  who  are  most  familiar  with  all  the  complex 
aspects  of  land  valuation, — for  he  is  the  Director  of  the 
house  of  business  t  which  transacts  the  greater  proportion 
of  such  operations — has  at  our  request  summed  up,  in  the 
following  terms,  the  causes  which  at  present  determine  the 
increase  in  the  value  of  property  : — 

"The  economic  life  of  the  country  offers  at  each  step 
signs  of  further  progress.  The  enlargement  of  ports,  the 
extension    of    railways,     the     dredging    of    channels,     the 

*  The  piastre  note  was  then  worth  1  franc  71 — Is.  4-4d.,  or  34-2  per  cent. 
of  the  par  value.     It  was  later  fixed  by  law  at  44  per  cent. — [Trans.] 

t  The  Bales  by  auction  conducted  by  this  house  during  the  first  sis  months 
of  1905  amounted  to  £2,376,000. 


THE  VALUE  OF  THE  SOIL  179 

development  of  the  building  trade  in  the  chief  city  of  the 
Republic,  all  show  the  spirit  of  enterprise  at  present  animat- 
ing the,  individual  and  the  people.  Commerce  and  vigorous 
industries  reinforce  these  elements  of  prosperity  and  welfare. 

"  But  it  is  in  matters  of  land  purchase  that  we  best 
perceive  the  material  expansion  and  the  intensity  of  the 
forces  in  action.  Without  going  back  to  the  year  1904,  we 
have  only  to  consider  the  transactions  of  the  last  few  years 
to  realise  that,  both  in  the  capital  of  the  Republic  and  in 
the  national  Territories  and  the  Provinces,  the  period  has 
been  a  fertile  one  in  the  matter  of  transactions  in  landed 
property.  There  has  been  no  more  active  period  since  1889 ; 
and  this  time  the  facts  have  an  explanation,  a  natural 
and  loo^ical  sanction.  Agriculture  and  stock-raising  have  so 
auo^mented  the  sources  of  national  wealth  that  in  a  few  years 
the  balances  iu  favour  of  the  country  have  reached  the 
figure  of  nearly  £20,000,000,  This  is  the  effective  cause  of 
the  increased  value  of  the  land :  to  which  we  must  add  the 
confidence  which  we  all  feel  in  the  gradual  development 
of  the  forces  which  labour  has  released,  to  the  benefit  of 
public  tranquillity." 

One  of  the  most  surprising  examples  of  the  increased 
value  of  the  soil,  and  of  the  interest  awakened  by  sales  of 
land,  is  to  be  found  in  the  public  and  official  auction  of 
national  lands  which  took  place  in  the  month  of  April  1905. 

These  sales  were  to  be  effected  on  account  of  those  who 
had  bouo-ht  these  lands  in  analogous  circumstances  in  1897, 
and  who  had  not  paid  for  them  during  the  delay  stipulated 
by  the  law.  The  whole  surplus  over  the  price  established 
by  the  previous  sale,  less  deductions  for  interest  and  other 
expenses,  went  by  law  to  the  original  purchaser.  The 
auctions  were  conducted  in  the  presence  of  a  crowd  of 
speculators,  capitalists,  and  labourers,  eager  to  invest  their 
money  in  so  remunerative  a  speculation,  since  in  the 
Argentine  all  are  convinced  that  the  purchase  of  the  soil  is 
the  best  form  of  saving.  The  result  of  the  sale  was  that 
in  many  cases  double  the  original  price  was  obtained  ;  three 
times  the  price  in  some  cases,  and  in  some  five  times  the 
original  price  was  realised. 

In  the  Territory  of  Painpa  Central  an  area  of   933,680 


180    THE  ARGENTINE  IN  THE  20th  CENTURY 

acres  was  offered  for  sale,  the  previous  price  being  £49,693  ; 
the  sale  price  was  £135,297,  representing  an  average  price 
of  £842-6  per  league,  or  2s.  8*7d.  per  acre. 

In  the  Territory  of  Chubut,  265,278  acres  were  put  up 
to  auction,  the  original  price  being  £5243"5,  and  the  sale 
price  £25,361*6,  or  an  average  of  £590'28  per  league,  or 
Is.  9-7d.  per  acre. 

In  the  Territory  of  Santa  Cruz  an  area  of  98,800  acres 
was  put  up  for  sale,  the  first  price  being  £3391  "34,  and  was 
sold  for  £9477-6,  or  Is.  lOd.  per  acre. 

In  the  Territory  of  Chaco,  in  which  especial  interest  was 
felt,  as  the  lands  in  question  bore  forests  of  quebracho  trees 
of  great  value  (the  quebracho  industry  being  then  in  vogue), 
higher  values  were  obtained,  representing  five  times  the 
original  sale  price.  The  lands  to  be  sold  in  this  Territory 
represented  a  surface  of  123,500  acres,  and  were  first 
disposed  of  for  £4948.  However,  a  price  of  £24,170  was 
obtained,  representing  an  average  of  £1208*24  per  league,  \ 
or  4s.  6-9d.  per  acre. 

In  the  Territory  of  Rio  Negro  74,100  acres  were  put  up 
for  sale,  which  were  previously  sold  for  £3058.  They  realised 
£8712,  or  £726  per  square  league,  or  2s.  4-2d.  per  acre.  The 
general  result  of  the  sale  was  that  the  Government  did  a 
splendid  stroke  of  business ;  but  the  transaction  was  still 
more  to  the  profit  of  the  fortunate  first  applicants,  who,  for 
failing  to  comply  before  a  given  date  with  the  conditions  . 
established  by  law,  were  rewarded  by  receiving  the  price 
of  sale  less  the  price  at  which  they  bought ;  sums  which  to 
many  of  them  represented  a  considerable  fortune. 

Since  that  period  the  value  of  land  has  continually 
increased,  as  we  see  from  the  following  information,  which 
was  given  us  by  the  "  General  Bureau  of  Lands  and  Colonies  " : 
of  the  Ministry  of  Agriculture.  In  1906  and  1907,  this 
Bureau  sold  by  public  auction  a  large  section  of  public  lands, 
and  the  prices  obtained  were  far  higher  than  those  we  have 
recorded  above. 

In  the  Territory  of  Rio  Negro,  in  August  1906, 
497,600  acres  were  sold  at  an  average  price  of  9s.  8d. 
per  acre. 

In   March    1907,  314,974   acres  of  land,  situated   in  the 


THE  VALUE  OF  THE  SOIL  181 

Peninsula    Valdez    (Chubut)    found    a    buyer    at    6s.    7^d. 
per  acre. 

Numerous  sales  were  effected  in  1907  in  the  Pampa 
Central.  Among  others,  we  may  cite  the  following:  18,520 
acres  sold  at  10s.  67d.  and  4640  at  10s.  per  acre  ;  a  lot  of 
18,750  acres  at  an  average  price  of  6s.  9'7d. ;  7500  at  68.  5d. ; 
151,410  acres  at  4s.  4-8d.;  1235  acres  at  3s.  7-6d. ;  and  12,350 
acres  at  3s.  11 -Sd.  per  acre. 

In  October  of  the  same  year,  auction  sales  were  held  in 
various  portions  of  Pampa  Central,  the  results  being  as 
follows  :  16,425  acres  at  8s.  10-24d. ;  5390  at  8s.  2-3d. ;  40,137 
at  10s.  3d. ;  24,700  at  7s.  4'3d. ;  306,050  at  an  average  price 
of  3s.  8-5d. ;  24,700  at  3s.  7-8d.,  and  9182  at  6s.  7-8d.  These 
examples  are  given  to  show  the  variety  of  actual  prices, 
according  to  the  situation  and  the  yield  of  the  land. 
I  In  the  matter  of  private  sales,  it  is  difficult  to  keep  track 
I  of  rising  values  on  account  of  the  number  of  sales  which 
itake  place  every  day.  We  will  try,  however,  to  give  a  few 
examples,  to  arrive  at  some  approximate  value  of  the 
Argentine  soil  in  the  year  1905. 

I  The  Province  of  Buenos  Ayrea,  which  is  the  most  thickly 
Ipopulated  and  the  wealthiest  in  the  Republic,  is  also  that 
I  in  which  rural  property  has  reached  its  highest  value.  In 
I  the  district  of  Lobos,  a  few  hours  from  Buenos  Ayres,  a 
field  of  170  acres,  known  as  the  Atucha  Meadow,  was  sold 
for  £26,  7s.  2d.  per  acre;  another  of  the  same  area  for 
£59,  8s.  9d.  per  acre;  another  of  635  acres  for  £12,  Is.  Od. 
per  acre,  and  another  of  587  acres  for  £14,  4s.  per  acre. 

In  the  region  of  Rojas,  also  some  hours  from  the  Federal 
capital,  the  land  on  which  stood  the  "  San  Jos^,"  "  Santa 
Barbara,"  and  "La  Matilde,"  establishments  belonging  to 
Sefior  Roberto  Cano,  and  whose  area  was  15,800  acres,  was 
sold  for  an  average  price  of  £8,  8s.  per  acre. 

In  the  neighbourhood  of  Dolores,  not  far  from  Buenos 
Ayres,  a  meadow  belonging  to  the  "  Montes  del  Tordillo " 
estate,  composed  of  18,850  acres,  was  sold  for  19s.  14d.  per 
acre.  In  the  section  of  Lincoln  10,000  acres  were  sold  at  prices 
varying  from  48s.  to  £5,  2s.  per  acre.  At  Trenque  Lauquen, 
one  of  the  belts  of  land  in  Buenos  Ayres  which  has  seen  the 
most  rapid  rise  in  values,  sales  have  been  effected  of  22,000 


182    THE  ARGENTINE  IN  THE  20th  CENTURY 

acres  at  prices  rising  from  £1,  18s.  to  £3,  6s.  per  acre,  the 
average  being  £2,  8s. 

In  this  same  section,  some  8  miles  from  the  railway 
station  of  Primera  Junta,  1976  acres  were  in  1907  sold  at 
prices  varying  from  £2,  8s.  3d.  to  £5,  12s.  9d.  At  General 
Pinto  the  land  belonging  to  the  "  Filadelfia  "  estate,  23,198 
acres  in  extent,  was  sold  at  an  average  price  per  acre  of 
£2,  2s.  9d. 

In  the  department  of  Olavarria  19,856  acres  were  sold  in 
1908  for  prices  varying  from  £3,  7s.  8d.  to  £7  per  acre,  the 
average  being  £5. 

In  the  department  of  General  Conesa,  11,085  acres,  facing 
the  Bay  of  Sao  Borombon,  and  23  miles  east  from  San 
Dolores,  found  a  buyer  at  an  average  price  of  £1,  3s.  4d.  per 
acre.  In  the  department  of  Coronel  Pringles,  the  establish- 
ment known  as  El  Bombero,  situated  some  19  miles  to  the 
west  of  Tres  Arroyes,  divided  into  thirty-one  lots  of  from  37C 
to  4940  acres,  was  sold  at  prices  running  from  £2,  Is.  l|d 
to  £4,  2s. 

Among  these  sales  of  1908  which  attracted  most  atten 
tion  were  those  transacted  iu  the  Province  of  Buenos  Ayres 
These  included  a  tract  at  Exaltacion  de  la  Cruz  of  an  are; 
of  914  acres,  near  the  railway  station  of  Cardales,  which 
sold  in  small  lots  of  from  58  to  180  acres,  obtained  ai 
average  price  per  acre  of  £29"6  per  acre.  At  Lomas  d' 
Zamora  the  land  of  the  establishment  "  Santa  Ines  "  were  soh, 
to  the  Sansinena  Company  for  £13,  3s.  6d.  per  acre.  In  th 
department  of  Azul,  a  meadow  known  as  "  La  Vanguardia,"  o 
an  area  of  2080  acres,  11  miles  from  the  town  of  Azu 
found  a  buyer  at  £7,  16s.  per  acre.  The  San  Miguel  estatt 
near  the  Manzanares  railway  station,  subdivided  into  thirty 
six  lots,  was  sold  at  an  average  price  of  £10,  5s.  per  aer«, 
On  the  19th  of  August  1908,  iu  the  same  department,  74 
acres  fetched  a  price  of  £12,  9s.  2d.  per  acre.  At  Genen 
Belgrano,  less  than  2  miles  from  the  railway  station,  329 
acres,  divided  into  five  lots,  were  sold  at  prices  varying  froi 
£8,  lis.  to  £10,  13s.  lOd.  A  tract  of  499  acres  aboi; 
1000  yards  from  Jeppener  Station,  in  the  department  c 
Brandzen,  was  sold  at  the  rate  of  £12,  5s.  9d.  Finally,  £ 
Burzaco,  at  a  distance  of  2500"  yards  from  the  station,  4£ 


THE  VALUE  OF  THE  SOIL  1H3 

lacres  of  land  attained  the  fabulous  figure  of  £42,  ISs.  per 
acre. 

1       These  are   high  prices  in  comparison  with  those  ruling 

iformerly,  and  at  present  they  are  firmly  maintained. 

1  The  prices  of  lands  suitable  for  agriculture  vary  greatly, 
according  to  their  distance  from  the  great  city  of  Buenos 
Ayres  or  the  port  of  Baliia  Blaiica,  and  their  proximity  to  a 
railway  station ;  accordingly  as  they  have  water  near  the 
surface,  and  are  thus  adapted  to  the  growth  of  lucerne  ;  and 
according  to  the  terms  of  payment  granted  by  the  vendors. 
There  are,  of  course,  other  factors  as  well. 

I       Among  many   other  examples,  we  will   cite  the  588,050 

.acres  of  land  at  Curumalan,  ten  hours  from  Buenos  Ay  res, 
the  property  of  a  syndicate  which  bought  them  in  1903  from 
Messrs  Baring  Bros,  of  London,  at  a  price  of  £807,575.  Up  to 
July  the  1st,  1905,  this  company  had  sold  more  than  247,000 
acres  of  land  directly  to  agriculturalists — Russian  for  the  most 
part — at  prices  varying  from  £2, 10s.  8d.  to  £3,  4s.  Id.,  allow- 
ing them  a  term  of  three  or  four  years  for  payment,  plus  an 
interest  of  8  per  cent,  per  annum. 

The  Province  of  Cordoba  is,  after  the  Province  of  Buenos 

I  Ayres,  that  in  which  the  land  has  most  rapidly  risen  in  value. 
Transactions  in  rural  property  are  very  numerous  and  repre- 

.  sent  an  important  figure.  In  the  five  years  from  1899  to  1903, 
about  9.386,000  acres  have  changed  hands,  and  in  1904  alone 
3,820,830  acres  were  sold. 

i  It  is  difficult  to  give  an  account  of  these  transactions  by 
reason  of  their  number  ;  but  to  cite  only  the  most  important, 
we  may  mention  a  block  of  61,750  acres  in  the  department  of 
Juarez  Celman,  belonging  to  Alejandro  Roca,  which  was  sold 
at  public  auction  in  the  early  part  of  1905,  at  prices  varying 

'  from  17s.  lOid.  to  £2,  6s.  per  acre.  In  view  of  the  prices  which 
the  buyers  realised  later,  they  made  a  splendid  bargain  ;  none 

:  of  them  sold  for   less  than  double  what  he  gave.     In  the 

:  Union  department  of  the  same  Province,  59,904  acres  were 
sold  at  prices  varying  from  13s.  3d.  to  £1,  168.  lid.  per  acre. 

Another  important  sale,  efifected  also  in  the  early  part  of 
the  same  year,  was  that  which  took  place  in  the  department 
of  Tulumba,  fifty  miles  from  the  colony  and  railway  station 

i  of  Morteros  on  the  Central  Argentine  railway.     The  block 


184    THE  ARGENTINE  IN  THE  20th  CENTURY 

sold  comprised  an  area  of  20,826  acres,  and  the  prices  obtained 
varied  from  Is.  58d.  to  2s.  2d.  per  acre. 

In  the  Province  of  Santa  Fe,  the  appreciation  of  land  values 
has  of  late  years  been  neither  so  great  nor  so  rapid  as  in 
Buenos  Ayres  and  Cordoba ;  the  reason  being  that  it  was 
this  Province  which  initiated  the  colonising  movement  in 
1856,  by  the  foundation  of  the  Esperanza  Colony,  so  that  iU 
land  values  had  already  undergone  sudden  augmentationsj 
in  previous  years.  In  the  five  years  from  1899  to  1903,  th«;' 
sales  have  amounted  to  £5,831,160  acres,  and  in  1904  tc 
2,026,420  acres.  In  the  department  of  General  Lopej 
23,487  acres  were  sold  for  prices  varying  between  28.  4d 
and  £2,  18s.  3d. 

We  may  also  note  a  tract  of  8204  acres,  8  miles  from  hi 
Serna  railway  station,  which  in  1908  was  sold  for  £1,  12s 
per  acre.  | 

The  Provinces  of  San  Luis  and  Santiago  de  I'Estero  wenj 
the  last  to  take  part  in  this  movement  of  appreciation  c 
land  values.  The  former,  in  especial,  has  from  this  point  o 
view  been  a  revelation  to  every  one.  As  soon  as  it  wa 
discovered  that  the  soil  of  this  Province  was  admirable 
adapted  to  the  formation  of  splendid  meadows  of  lucernei 
its  value  rapidly  rose  from  Is.  5^d.  to  6s.  5"7d.,  12s.  lldj 
and  19s.  5d.  j 

We  must,  in  particular,  mention  a  meadow  known  as  tixi 
"  Agualapada,"  98,000  acres  in  area,  which  on  the  27th  of  Jul;; 
1908  was  sold  at  the  rate  per  acre  of  5s.  4d.  53,219  acres  c 
land,  some  13  miles  from  the  railway  stations  of  Nueva  Gali 
and  La  Fortuna  were  bought  at  an  average  price  of  10s.  3( 
per  acre.  In  the  department  of  Pedernera  16,043  acre 
divided  into  five  lots,  found  purchasers  at  prices  varyin 
from  16s.  2d.  and  £1,  Is,  2d.  to  £1,  15s.  9d. 

But,  as  we  have  already  said,  it  is  in  the  Pampa — in  the 
vast  country  of  56,170  square  miles  in  area— larger  tha 
England — which  was  incorporated  in  1880,  after  the  exped 
tion  led  by  General  Roca — that  the  most  surprising  example 
of  appreciation  are  to  be  found.  There  all  is  undergoing 
continual  transformation ;  each  year  the  plough  opens  wid( 
furrows  for  the  seed ;  the  sowing  of  lucerne  is  rapidl 
increasing ;  stock-raising  establishments  are  to  be  found  i 


I  THE  VALUE  OF  THE  SOIL  185 

:he  very  confines  of  the  country  ;  and  a  larrje  network  of 
-ailways,  in  operation,  in  construction,  or  under  considera- 
ion,  promise  to  surround  it  on  every  hand,  to  circulate  its 
oroducts  and  to  facilitate  exchange.  All  these  wonderful 
oransformations  are  being  effected  under  our  eyes,  day  by 
iay ;  so  that  it  is  not  surprising  that  the  value  of  the  soil 
'follows  this  tide  of  energy. 

In  the  Pampa  Central,  of  late  years,  we  have  seen  land 
mitable  for  lucerne,  with  water  10  to  30  feet  below  the  soil, 
lot  far  from  populated  centres,  and  with  means  of  rapid 
;!ommunication,  fetch  prices  which  quadrupled  those  it  had 
touched  eighteen  months  earlier,  selling  for  as  much  as 
£3,  lis.  3d.  per  acre.  In  more  than  one  case  land  which  was 
oought  for  £880  the  square  league  was  afterwards  sold  for 
£8800. 

Among  the  sales  of  1908  was  one  of  a  meadow  of  18,525 
icres,  six  miles  from  Utracan  Station,  which,  sold  by  order 
Df  the  law,  fetched  a  price  of  I7s.  lOd.  per  acre.  In  another 
part  of  the  same  Territory  7698  acres  were  sold  in  a  single 
lot,  on  the  1st  of  October  1908,  at  the  rate  of  £1,  4s.  7d.  per 
icre.  In  the  Alfalfa  Colony,  during  an  auction  sale,  several 
zJiacras,  or  small  farms.attained  prices  varying  from  £1, 19s.  3d. 
to  £2,  2s.  9d.  per  acre. 

By  the  Catrilo  railway  station  on  the  Western  Railway, 
situated  in  the  same  Territory  of  El  Pampa,  is  a  field  whose 
3wner,  M.  Mathias  R.  Sturiza,  was  oflfered  £61,600  for  it ;  two 
years  earlier  he  had  bought  it  for  £5280. 

Competent  authorities  assure  us  that  in  the  neighbourhood 
of  Santa  Rosa  de  Toay,  the  capital  of  the  Territory  of  the 
Pampa,  the  value  of  the  fields  has  been  shown  by  recent 
sales  to  have  increased  by  300  per  cent.  In  the  department 
of  Victoria,  in  the  same  Territory,  fields  which  a  while  ago 
were  oflfered  at  28.  15d.  per  acre,  are  to-day  selling  for 
i£l,  is.  4d. — ten  times  that  sum. 

i  Such  are  the  chief  manifestations  of  the  economic 
phenomena  of  the  appreciation  of  land  values ;  one  of  the 
most  interesting  of  the  problems  which  present  themselves  to 
the  observer  of  the  modern  Argentine  Republic.  Is  it  a  true 
symptom  of  national  vitality,  or  must  we  see  in  these  data 
the  warnings  of  a  period  of  commercial  crisis,  characterised  , 


186    THE  ARGENTINE  IN  THE  20th  CENTURY 

according  to  the  learned  economist  Juglar,  by  the  rise  of  all 
values  and  by  frantic  speculation  ? 

Events,  which  unroll  themselves  amidst  our  feverish 
Argentine  activities  far  more  rapidly  than  in  other  countries, 
will  not  be  long  in  giving  us  the  answer  to  these  questions.* 

*  The  importance  of  the  sales  of  rural  property  is  to-day  so  great,  and 
speculation  so  eager,  that  the  prices  given  here,  according  to  information 
gathered  barely  a  few  months  ago,  appear  to  us  already  as  ancient  history. 


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CHAPTER   V 

AGRICULTURAL   INDUSTRIES 

CGAR-t-'ANE — Area  of  plantations — Statistics  of  production  —  Legislation 
affecting  sugar — Consumption. 

ijjES — Area  of  vineyards  planted — Production,  consumption — Imperfect  quality 
— Competition  of  foreign  imports. 

OBACCO — Area  of  plantations — Value  of  the  product — Defective  preparation. 

UE  MuLBRRKi — The  culture  of  the  silk-worm  might  be  established  in  the 
Argentine,  but  at  present  exists  only  in  an  experimental  condition. 

!ate — Largo  consumption  of  this  product. — Statistics  of  foreign  importation — 
Districts  suitable  for  its  growth. 

OTTON — Physical  conditions  proper  to  its  growth — The  first  favourable  results 
in  the  Argentine — Its  introduction  into  Chaco — Lack  of  manual  labour  for 
the  dbvelopment  of  this  industry. 

CBBER — Existence  of  rubber  plants  in  the  Argentine — An  unexploited  source 
of  wealth. 

RBORiccLTORE — On  account  of  the  diversity  of  the  climate,  all  fruit-trees  can 
be  grown  in  the  Argentine — The  various  fruits  cultivated  in  different 
regions — Amelioration  of  the  products.  The  trade  in  fruit — Its  develop- 
ment possible  on  account  of  the  inversion  of  seasons  as  compared  with 
Europe — Refrigeration  applied  to  the  transport  of  fruit — Regions  particu- 
larly suitable  for  fruit-growing. 

RESIDES  the  culture  of  cereals,  such  as  wheat  and  maize 
J  and  linseed,  and  the  important  grazing  and  cattle-breeding 
idustries  of  the  Argentine,  together  with  their  dependent 
iidustriea,  there  are  other  forms  of  agriculture  and  forms 
t:  natural  produce,  some  of  which  have  already  attained  a 
ireat  importance,  while  others  are  destined  to  become  equally 
ioportant  in  the  near  future ;  that  is,  if  the  progress  of 
•/olution  in  the  Argentine  follows,  as  there  is  reason  to 
ppe,  its  natural  upward  course. 

;  Sugar  -  cane. — Among  the  agricultural  industries  the 
ulture  of  the  sugar-cane  assumes  the  first  rank.  The  cane 
:  cultivated  principally  in  the  Province  of  Tucuman,  in 
hich  Province  are  established  the  greater  number  of  the 
.'igar  factories  existing  in  the  Republic.  The  caue  is  also 
187 


188    THE  ARGENTINE  IN  THE  20th  CENTURY 

planted,  and  flourishes,  in  portions  of  the  Provinces  o 
Santiago,  Salta,  and  Jujuy ;  in  the  north  of  Santa  Fe,  ii 
Corrientes,  and  in  the  Territories  of  Formosa,  Chaco,  an 
Misiones. 

Sugar-planting  is  an  industry  of  considerable  antiquit: 
in  the  Argentine ;  but  it  has  attained  a  remarkable  develop 
ment  chiefly  in  the  last  ten  years,  owing  to  the  high  pric; 
of  sugar  and  the  establishment  of  numerous  factorif. 
equipped  with  perfected  machinery ;  owing  also  to  tb 
notable  profits  which  the  industry  ofi'ers. 

The  result  has  been  an  excess  of  production,  which  h 
the  industry  into  a  dangerous  cri^^is,  from  which  it  is  no 
in  a  fair  way  to  recover.  Those  who  suffered  the  most  we 
those  who  had  abused  their  credit  by  building  expensr 
factories  and  laying  down  costly  plant ;  and  those  who  h{ 
planted  sugar  in  soils  unsuited  to  its  culture,  or  in  regie: 
of  unfavourable  climate,  or  where  the  means  of  transpc. 
were  insufficient. 

The  total  area  cultivated  in  1907  was  estimated  at  abc, 
172,900  acres,  of  which  14,029  were  in  the  Province  ' 
Tucuman  ;  11,115  in  Southern  Chaco;  6916  in  Salta  ;  3952  i 
Jujuy,  and  2717  in  Santiago  de  I'Estero;  the  rest  bei; 
divided  among  various  other  regions  of  the  Republic ;  th( } 
figures  representing  an  increase  of  nearly  24,000  acu 
over  those  of  1895.  These  172,900  acres  of  cane  give  i 
average  yield  of  30  tons  of  sugar  per  hectare,  or  ll"Tf 
tons  per  acre,  representing  a  total  yield  of  132,160  tons  f 
sugar. 

The  greatest  number  of  sugar  refineries  are  to  be  f  ou  1 
in  the  Province  of  Tucuman,  where  there  are  thirty-two.  Q 
the  other  sugar-growing  districts  there  are  only  thirtei, 
which  are  distributed  as  follows:  Three  in  Jujuy,  two, a 
Santiago  de  I'Estero,  one  in  Salta,  one  in  Misiones,  six  n 
the  banks  of  the  Parana  River,  two  in  Santa  Fe,  two  n 
Corrientes,  one  in  Chaco,  and  one  in  Formosa. 

The  net  cost  of  producing  the  cane,  ready  for  deliv(f, 
is   about   5   to    7    centavos*  per  10  kilograms.     Taking  w 

*  The  centavo  is  ^h;  °^  '^^  °^  *^^  piastre.  In  metallic  currency  it  is  e  al 
to  the  American  cent,  and  nearly  to  the  English  halfpenny;  in  papt  J* 
is  worth  a  little  over  one-fifth  of  a  penny  =  -22727  pence. 


AGRICULTURAL  INDUSTRIES  189 

basis  a  yield  of  30,000  kilograms  per  hectare  and  a  sale  price 
of  12  centavos,  the  growers  would  make  a  net  profit  of 
140  piastres  per  hectare  ;  or,  with  the  value  of  the  piastre 
note  at  22  francs,  of  £4,  2s.  6d.  per  acre.  Thus  sugar- 
planting  is  a  profitable  industry  under  normal  conditions. 

The  outgoings  and  receipts  on   an  acre  of   soil   planted 
with  cane  may  be  estimated  as  follows : — 

Rkckipts. 
By   sale   of    12    tone   of    cane,    at    12-8d.    per 

cwt £12  IG     0 

EXPENSKS. 

Cost  of  Planting — 

Tilling  and  preparing  soil £0     9  11 

Lining  out  and  fixing  shoots 

Shoots,  preparation,  etc.    ... 
Coit  of  Harvestimj — 

Cutting  12  tons  of  cane 

Preparing  the  cane 

Transport  to  factory  and  extras 

1  Interest    on     the    land,     or    rent,    taxes,     and 

[  redemption 


I  Net  profit 

With  an  increased  consumption  of  sugar,  the  culture 
pf  the  Ciine  will  occupy  a  far  greater  area  of  the  belt  in 
which  it  is  already  established.  It  is,  however,  limited  by 
the  interests  of  the  manufacturers  themselves,  who  limit 
:)roduction  in  order  to  keep  up  the  price  of  sugar,  and  so 
obtain  higher  profits ;  sugar  of  native  preparation  being 
Drotected  by  laws  which  strike  at  the  importation  of  foreign 

.juErar.* 

I 


0  1« 
0  12 

4 

0  14 
0  14 
2  13 

2 
2 

1     1 

3 

£7     2 
12  IG 

0 
0 

£5  14 

0 

*  This  is  an  interesting  object-lesson  in  the  working  of  a  tariff.  Foreign 
!:ompetition  once  abolished  by  the  increased  prices  of  foreign  articles,  the 
kative  manufacturer  will  always  minimise,  and  oven  destroy,  the  protection 
i.fforded  by  the  tariff,  by  increasing  his  own  prices.  If  he  cannot  do  so 
laturally  he  will  do  so  by  lessening  his  output ;  with  the  result  that  sooner  or 
iter  the  tariff  will  actually  increase  foreign  imports  and  still  further  limit 
riome  production.  Obviously  the  only  circumstance  under  which  it  can 
i'ermanently  profit  even  the  manufacturers  is  this :  a  tariff  so  high  as  to 
aake  importation  ruinous  ;  when  the  home  producer  will  raise  his  prices  until 
hey  are  just  below  the  line  of  unprofitable  inflation  ;  which,  from  the  context, 
.ould  seem  to  be  the  case  in  the  Argentine.  The  consumer  must  suffer,  and 
sually  the  emp^oy^.— [Tbans.J 
N 


190    THE  ARGENTINE  IN  THE  20th  CENTURY 

In  1907  2,49«,000  lb.  of  foreign  refined  sugar  were 
imported,  their  value  being  £181,755  ;  but  on  the  other  hand 
140,370  lb.  were  exported  during  the  same  year. 

It  is  to  be  hoped  that  the  price  of  sugar  will  not  fall  too 
low,  as  this  might  bring  about  the  ruin  of  an  industry  which 
is  worth  encouraging  and  preserving :  but  it  is  essential,  on 
the  other  hand,  to  oppose  an  excessive  inflation,  which  would 
diminish  the  consumption  of  this  valuable  alimentary  product, 
and  would  force  the  consumer  to  pay  the  exaggerated  profits 
of  a  small  number  of  manufacturers  and  planters.  This  is 
the  inherent  peril  of  excessive  protection. 

The  law  of  23rd  January  1904  and  the  regulation  of 
25th  October  of  the  same  year  have  provided  for  this 
condition.  One  must  not  forget  that  all  commerce  is 
conditioned  by  the  law  of  supply  and  demand,  and  that  to 
avoid  overloading  the  market  with  produce,  production  must 
be  limited,  according  to  circumstances,  and  in  proportion  to 
actual  requirements ;  and  beyond  the  limit  of  absorption 
the  productive  energies  of  the  country  must  be  diverted  to 
other  cultures  or  industries,  more  remunerative  and  more 
certain  as  to  results.* 

Of  all  the  sugar  sold  in  the  Argentine,  only  part  is 
refined ;  there  is  at  present  only  one  refinery  t  in  the 
country ;  namely,  the  "  Refineria  Argentina "  of  Rosario. 
The  greater  proportion  of  Argentine  sugar  is  delivered  to 
the  consumer  in  the  form  of  "  moist "  or  brown  sugar,  which 
is  graded  according  to  its  colour  and  the  care  taken  in  its 
manufacture. 

There  are  in  several  districts,  and  especially  in  the 
neighbourhood  of  Misiones,  rudimentary  factories  where  an 
impure  sugar  known  as  "  rapadura  "  is  prepared,  which  is 
sold  in  cubes  or  tablets.  We  have  no  precise  data  as  to  the 
production  of  the  various  grades  of  sugar. 

During  the  last  twelve  years  the  manufacture  of  sugar 

*  See  the  important  work  entitled  La  Culture  des  Flantes  Industrielles  dam 
la  lUpuhlique  Argentine,  by  Carlos  D.  Girola,  published  in  the  Recensement  di 
^agriculture  et  de  I'dlevage  de  la  Nation,  Vol.  1.  1908,  from  which  these  datf 
are  extracted. 

t  The  thirty-two  factories  hitherto  referred  to  would  presumably  be  crushing 
mills,  where  cane  is  crushed,  the  juice  evaporated  into  syrup  or  molasses  am 
in  some  cases  dried,  the  product  being  "raw"  sugar. — [Trans.] 


AGRICULTURAL  INDUSTRIES  191 

has  been  greatly  improved,  as  a  consequence  of  tlie  crisis 
through  which  the  industry  passed,  which  demonstrated  the 
necessity  of  perfecting  the  methods  of  preparing  and  refining 
the  "sap,"  etc.  To-day  a  yield  is  obtained  of  7^,  8^,  and 
even  9  per  cent,  of  sugar. 

The  capital  sunk  in  the  sugar  industry  in  the  Province 
of  Tucuman  amounts  in  round  figures  to  £4,136,000,  and 
is  distributed  as  follows:  Land,  £1,232,000;  plantations, 
£440,000;  machinery,  £1,496,000;  buildings  £968,000. 

It  will  be  as  well  to  give  some  retrospective  data  here, 
which  will  show  how  far  the  production  of  sugar  has 
developed  during  the  last  few  years.  In  another  chapter  we 
shall  deal  with  the  production  of  sugar  from  the  industrial 
point  of  view. 

Thus,  in  1884  the  harvest  was  24,000  tons;  in  1894, 
: 75,000  tons;  and  in  1895  it  amounted  to  109,000  tons,  or  an 
j  increase  of  352  per  cent,  in  eleven  years.  In  1904  the  yield 
I  was  134,000,  or  an  increase  of  360  per  cent,  over  that  of  1884. 
!  In  1905  it  was  137,000  tons ;  in  1906, 180,000 ;  in  1907, 113,000. 
We  have  stated  that  the  Argentine  Republic  underwent 
a  crisis  in  the  matter  of  sugar,  on  account  of  excessive 
[production;  and  that  like  other  sugar-producing  nations  she 
'has  had  to  facilitate  the  export  of  the  surplus  by  granting 
;l  bounty  to  exportation. 

This  premium  or  bounty  was  conceded  in  the  following 
[manner  :  a  law  of  1894  forced  the  producer  to  pay  6  centavos 
per  kilogram,  or  •576d.  per  lb.  on  manufactured  sugar ;  but 
'offered  him  a  bounty  of  16  centavos  per  kilogram — l'536d. 
per  pound — on  all  sugar  exported  under  certain  conditions. 

This  law  ceased  to  be  in  force  on  the  31st  of  December 
1904;  but  was  replaced  by  another,  of  the  1st  of  January 
1905,  by  which  the  manufacturer  who  did  not  export  25  per 
cent,  of  the  sugar  he  produced  paid  15  centavos  per  kilogram  — 
or  l'44d.  per  lb. — on  a  quarter  of  his  produce,  or  on  the  pro- 
portion which  he  did  not  export. 

These  two  laws  contain  a  radical  difference.  By  the  first, 
the  State  received  6  centavos  per  kilogram  upon  all  sugar 
1  manufactured,  of  which  it  restored  4  centavos  for  each 
■kilogram  delivered  for  consumption,  and  then  restored  16 
i centavos  for   each   kilogram   exported ;    thus   keeping   to   u 


192    THE  ARGENTINE  IN  THE  20th  CENTURY 


minimum  tax  of  2  centavos  on  sugar  delivered  for  con- 
sumption. By  the  second  law  the  State  received  nothing  on 
sugar  leaving  the  factory,  as  the  producer  confined  himself 
to  giving  an  undertaking  for  the  value  of  15  centavos  per 
kilogram  on  a  quarter  of  his  manufactures,  which  under- 
taking was  returned  to  him  if  he  exported  a  quarter  of 
his  produce ;  so  that  in  case  he  did  export  his  produce  the 
State  gained  absolutely  nothing.  But  according  to  a  resolu- 
tion on  the  part  of  the  Government,  passed  in  April  1905,  the 
tax  of  15  per  cent,  was  8uppressed,togetherwith  the  obligation 
of  exporting  a  certain  percentage  of  the  sugar  made.  The 
sugar  industry  thereupon  entered  upon  a  new  period  of 
absolute  liberty,  and  at  the  same  time  was  deprived  of 
oflScial  protection.  In  this  matter  the  Argentine  Republic 
acted  in  accordance  with  the  international  agreement  of 
Brussels,  which  suppressed  the  sugar  bounty. 

The  consumption  of  sugar  during  the  eight  years  1897- 
1904  was  780,000  tons,  or  97,000  tons  per  annum.  This 
consumption  has  not  actually  been  uniform ;  for  instance,  in 
1897,  about  80,000  tons  were  consumed  ;  while  in  1904,  1905, 
1906  and  1907,  the  figures  were  respectively  about  115,000, 
162,000,  127,000,  and  109,000  tons. 

Vines. — Another  important  branch  of  agriculture  in  the 
Argentine  is  viticulture,  which  is  more  especially  utilised  in 
the  Provinces  of  Mendoza  and  San  Juan.  To  give  some  idea 
of  the  development  of  this  branch  of  agriculture  we  may 
state  that  in  1885  80,376  acres  were  planted  with  vines, 
while  to-day  the  figure  is  over  139,000.  Of  this  total  74,620 
acres  are  in  Mendoza  and  30,580  in  San  Juan.  The  different 
species  of  grape  are  selected  from  the  best  to  be  found  in 
cultivation  in  France  and  other  vine-growing  countries. 

The  vineyards  have  been  laid  out  under  favourable  con- 
ditions, yet  their  product  leaves  something  to  be  desired. 
Moreover,  bad  wines  have  often  been  put  on  the  markets,  sour 
wines,  and  wines  adulterated  with  water,  which  have  dis- 
credited the  native  wines,  and  have  led  many  to  doubt 
whether  the  Argentine  wine  industry  can  ever  really  take 
root. 

The  factor  which  has  chiefly  contributed  to  this  disastrous 
result  is  the  lack  of  capital  from  which  the  industry  suffers ; 


I 


il 


AGRICULTURAL  INDUSTRIES  193 

the   result  being   that    the   processes   of   fermentation   and 
maturing  are  not  given  sufficient  time. 

Pressed  by  their  liabilities,  the  Argentine  vine-growers 
hurry  over  their  wine-making,  so  as  to  put  their  wares  on 
the  market  as  quickly  as  possible,  in  order  to  meet  their 
engagements.  The  general  result,  apart  from  exceptions  as 
honourable  as  few  in  number,  is  that  the  industry  produces 
decoctions  of  a  kind,  but  not  wines. 

Despite  these  unfortunate  conditions  the  consumption  of 
the  wines  of  the  country  has  reached  a  very  considerable 
figure,  which  fact  has  greatly  contributed,  thanks  to  very 
heavy  customs  duties,  to  the  exclusion  of  foreign  wines.  In 
1899,  to  go  back  no  further,  the  total  consumption  of  wine  in 
the  Republic  was  322,431,166  pints,  of  which  237,600,000 
pints  were  of  wines  of  the  country,  and  84,800,000  of  foreign 
wines  (not  including  those  imported  in  bottles).  In  1900 
304,440,000  pints  were  consumed  ;  221,760,000  of  native 
wines  and  82,680,000  of  foreign  wines.  In  1901,  out  of 
327,360,000  pints,  242,880,000  were  of  native  and  84,480,000  of 
foreign  wines ;  in  1904,  of  a  consumption  of  373,120,000  pints, 
307,000,000  were  of  native  and  66,120,000  of  foreign  wines. 

In  1907  the  total  consumption  of  wines  in  the  entire 
Republic,  according  to  the  office  of  National  Statistics  and 
Administration  of  Inland  Revenue,  amounted  to  638,843,680 
pints,  of  which  558,096,000  were  of  native  production  and 
100,747,680  were  imported. 

The  production  of  native  wines  is  limited,  as  we  have 
seen,  to  wines  for  general  consumption.  The  finer  varieties 
are  imported. 

The  consumption  of  wines  of  quality  in  1907  reveals  a 
considerable  increase  since  the  previous  year ;  which  is  yet 
another  proof  in  support  of  the  many  to  be  found  in  this 
book  of  the  excellent  economic  and  therefore  gastronomic 
conditions  of  the  country.  The  large  and  profitable  results 
if  the  harvests  enable  the  people  to  place  fine  wines  upon 
i,heir  tables. 

The  customs,  which  are  always  a  faithful  barometer  of 
;he  degree  of  well-being  which  a  people  enjoys,  affi^rd  us 
I  proof  of  what  we  have  affirmed.  In  1907  there  passed 
through  the  customs  houses,  coming  from  abroad,  59,520  dozens 


194    THE  ARGENTINE  IN  THE  20th  CENTURY 

of  bottles  of  champagne,  1988  dozens  of  sherry,  plus  31,438 
pints  in  the  wood;  6925  dozens  of  port,  plus  113,843  pints  in 
the  wood ;  516,520  dozens  of  vermouth ;  27,624  dozens  of 
semi-fine  wines;  1249  dozens  of  French  clarets,  and  8111 
dozens  of  sparkling  wines.  The  vins  ordinaire  imported 
represented  a  total  of  100,748,680  pints. 

As  we  have  already  seen,  the  area  of  the  vineyards  in 
existence  at  the  end  of  1907  was  of  139^132^30  acres,  their 
value  being  £18,400,000.  As  for  their  yield,  it  amounted  to 
1,121,523,300  lbs.  of  grapes,  or  more  than  518,000  tons,  with 
an  estimated  value  of  £3,680,000. 

There  are,  in  the  Argentine  Republic,  3097  establishments 
devoted  to  the  exploitation  of  the  vineyards  and  the  making 
of  wine,  disposing  of  a  total  capital  of  some  £4,320,000. 
Their  products  amount  to  66,762,000  gallons  of  wine,  repre- 
senting a  value  of  £4,720,000. 

If  we  compare  the  production  of  the  Argentine  with  that 
of  the  principal  nations  of  the  two  Americas,  we  obtain,  for 
the  year  1907,  the  following  table  : — 

Argentine  Republic  ...  ...  556,096,000  pints 

Chili       ...  ...  ..  ...  475,200,000 

United  States  ...  ...  ...  281,160,000 

Brazil     ...  ...  ...  ...  56,320,000 

Pern       ...  ...  ...  ...  17,248,000 

Uruguay  ...  ...  ...  16.192,000 

Bolivia   ...  ...  ...  ...  5,576,000 

Mexico  ...  ...  ...  ...  3,168,000 

The  Argentine  wine  industry,  in  which  millions  have  been 
engaged,  is,  as  we  see,  on  the  road  of  progress.  It  has  to-day 
accomplished  a  rapid  and  a  very  considerable  development 
which  might  well,  in  the  near  future,  eliminate  the  imported 
product  from  the  market,  at  least  in  the  case  of  wines  foi 
ordinary  consumption. 

Like  the  sugar  industry,  the  wine-growing  industry  ha: 
gone  through  its  crisis.  On  the  one  hand  the  abuse  madi 
of  credit  in  establishing  warehouses,  cellars,  and  costly  plant 
and  on  the  other  defective  methods  of  manufacture  whicl 
brought  the  product  into  discredit,  produced  a  deep-roote" 
depression,  from  which  the  industry  has  hardly  yet  emergec 
It  cannot  look  to  the  future  until  it  perfects  its  means  c 


AGRICULTURAL  INDUSTRIES  195 

preparation,  working  out  its   brands   with   the  aid  of  tiuio 
and  patience. 

This  industry,  says  an  eminent  writer,  gives  work  to 
more  than  100,000  inhabitants,  and  represents,  as  a  matti-r 
of  national  wealth,  a  value  in  vineyards  and  factories  of 
some  £19,000,000  ;  it  produces  annually  £4,840,000  worth  of 
merchandise,  contributes  £6,950,000  to  the  general  tnide, 
and  surpasses  in  importance,  both  in  the  capital  employed 
and  in  its  products,  the  sugar  industry  of  the  country, 
which  in  1907  manufactured  sugar  only  to  the  value  of 
£2,772.000.* 

Tobacco. — For  a  long  time  the  tobacco-plant  has  been 
cultivated  in  the  Argentine;  for  we  find,  in  various  zones, 
conditions  very  favourable  to  its  production;  but  its  culture 
has  by  no  means  as  yet  acquired  the  importance  of  which  it 
is  capable,  and  is  very  far  from  satisfyiug  the  needs  of 
national  consumption. 

The  exports  are  insignificant:  37,983  lb.  in  1906,  and 
16,612  lb.  in  1907,  of  the  respective  values  of  £539  and 
£226.  The  lack  of  care  brought  to  the  cultivation 
of  the  plant  and  to  the  preparation  of  the  leaf,  together 
with  incomplete  experience  from  the  industrial  point 
of  view,  have  contributed  to  check  the  increase  of  planta- 
tions, which  ought  to  occupy  a  far  larger  area  than 
they  do. 

Tobacco  is  grown  chiefly  in  the  northern  region 
composed  of  the  Provinces  of  Corrientes,  Salta,  and  Tucu- 
man ;  it  is  also  grown  to  a  less  extent  in  the  Provinces 
and  Territories  of  Misiones,  Formosa,  Chaco,  Catamarca, 
La  Rioja,  and  Jujuy.  It  may  be  grown  equally  well  in  the 
central  region  composed  of  the  Provinces  of  Buenos  Ayres, 
Entre  Rios,  Santa  Fe,  and  C6rdoba  ;  and  even  further  south. 
There  were  formerly,  and  are  still,  tobacco  plantations  in 
the  Province  of  Buenos  A.yres,  which  appeared  to  promise 
a  fair  future  for  tobacco-planting  ;  but  all  is  as  yet  in  a 
rudimentary  condition,  and  the  industry  makes  no  appreci- 
able progress. 

*  See  I' Industrie  viti-vinicole  de  la  Ripublique  Ar^/enttne,  by  Ricardo 
Palencia,  an  essay  published  in  the  Reccnscment  de  Vagriculture  et  de  l'dleva(/e  de 
la  Nation.    Vol.  I.     Buenos  Ayres. 


196    THE  ARGENTINE  IN  THE  20th  CENTURY 

The  areas  planted  with  tobacco  in  1895  and  1907  were 
as  follows : — 


1895. 

1907. 

Acres. 

Acres. 

Province  of  Corrientes         

16,287 

27,910 

.,      „     Salta 

2,277 

8,645 

,,      ,,     Tucmnan 

6,880 

7,410 

Territory  of  Mision^s           

5,705 

1,976 

,,      ,,     FormoBa  and  Chaco  (South) 

1,294 

1,235 

Province  of  Cdrdoba            

3,348 

1,729 

Other  Provinces — 

Buonos  Ayres,  Santa  Fe,  Catamarca 

3,631 

2,470 

Totals       ...         39,422  51,375 

The  agricultural  census  of  1895  affirmed  the  existence  of 
3348  acres  of  tobacco  in  C6rdoba.  while  the  Bulletin  of  the 
Division  of  Statistics  at  the  Ministry  of  Agriculture  announced 
only  1729  acres  ;  in  short,  everything  leads  to  the  conclusion: 
that  we  have  to  deal  either  with  gross  blunders  or  with 
erroneous  information.  As  it  has  not  been  practicable  for; 
us  to  verify  these  figures  we  must  suppose  that  in  1895  there 
was  not  so  large  an  area  planted  as  the  figures  would  lead  us. 
to  believe.* 

The  Mulberry. — The  culture  of  the  mulberry-tree  should 
perhaps  be  included  in  that  of  industrial  crops,  since  its  leaves 
are  the  food  of  the  silkworm. 

From  the  time  of  the  Spanish  Conquest,  says  Carlos 
Girola,  the  engineer,  our  competent  guide  in  the  matter  of 
industrial  crops,  the  silkworm  was  raised  in  the  Province  of; 
Cuyo,  and  silk  was  woven  there  on  the  hand-loom  ;  but,  on! 
account  of  the  facilities  of  transport,  imported  silks  brought 
such  a  competition  to  bear  upon  the  hand-made  native 
article  that  the  silkworm  industry  gradually  dwindled  and 
finally  became  extinct.  ; 

Numerous  experiments  have  of  late  years  proved  that: 
the  silkworm  can  be  raised  over  a  great  part  of  the  country  ;' 
and  that  it  has  the  best  chances  of  development  where  the! 
population  is  densest,  labour  most  abundant,  and  the  houses! 
of  the  workers  largest  and  most  comfortable,  as  in  the 
Provinces  of  Buenos  Ayres  (North)  and  Santa  F^,  and  in  parts 

♦  See  La  Culture  des  Plnntes  industrielles  dans  la  R^publique  Argentine,  by 
Carlos  D.  Girola.  \ 


AGRICULTURAL  INDUSTRIES  197 

of  Entre  Rios  and  Cordoba.  So  far,  however,  there  is  no 
demand  for  the  native  cocoons,  and  it  is  so  difficult  to  place 
bhem  that  at  present  one  cannot  recommend  the  silkworm 
ndustry  except  as  an  experiment  or  a  speculation. 

The  mulberry-tree  grows  and  flourishes  excellently  on 
:he  greater  portion  of  the  Argentine  soil,  and  especially  in 
.he  central  and  northern  districts,  where  it  springs  up  (luickly 
ind  vigorously.  It  is  greatly  to  be  desired  that  it  should  be 
nore  widely  cultivated,  and  that  its  wider  cultivation  should 
;o  hand  in  hand  with  the  development  of  the  sericultural 
ndustry,  which  in  some  countries  constitutes  one  of  the 
principal  sources  of  wealth. 

:  The  mulberry  also  furnishes  an  excellent  wood,  and  ita 
leaves  may  be  used  to  feed  cattle  as  well  as  silkworms, 
nstead  of  planting  trees  which  are  of  no  industrial  use,  the 
nulberry  should  be  given  the  place  of  preference. 

Yerba  MaU. — The  "  yerba  mate,"  or  mat^  shrub,  is  met 
Vith  in  the  woods  of  Misiones,  where  it  grows  in  irregular 
lumps  of  varying  extent.  It  has  been  known  since  the 
ime  of  the  Jesuits,  who  were  the  first  to  plant  and  cultivate 
fc,  as  is  proved  by  the  plantations  which  to  this  day  exist  in 
he  territory  of  the  Argentine  Missions  (Misiones).  With 
he  leaf  of  this  plant  infusions  are  made,  as  with  tea,  coffee, 
3Coa,  etc.  The  matheine  contained  in  the  leaves  is  possessed 
■f  properties  at  once  tonic  and  stimulating. 

The  infusion  of  "  yerba  mate "  is  usually  made  in  a 
sceptacle  shaped  like  a  pear  with  an  orifice  at  the  smaller 
nd ;  *  it  is  imbibed  by  means  of  a  silver  tube  having  at  one 
ad  a  bulb  pierced  with  holes,  which  performs  the  office  of 
strainer,  and  is  known  as  the  honihilla.  This  method  of 
reparation  and  of  use  is  now  tending  to  disappear ;  and 
lat^  is  now  often  prepared  in  the  same  way  as  coffee,  the 
bsult  being  a  very  refreshing  drink,  very  valuable  in  the 
)untry  districts  for  the  refreshment  of  travellers.  Statistics 
rove  that  the  consumption  of  mat6  is  continually  increasing  ; 
ad  as  the  national  production  is  insufficient,  recourse  is  had 

)  *  Usually  a  gourd  is  used,  of  either  spherical,  ovoid,  or  pear-like  shape, 
th  one  end  sliced  off;  it  is  commonly  polished  and  carved,  often  by  Guachos 
I  Indians.  Each  drinker  has  his  own  gourd  and  bombilla,  the  latter  being 
I'cessitated  by  the  use  of  the  leaf  in  the  form  of  a  powder. — [Tbanu.] 


198    THE  ARGENTINE  IN  THE  20th  CENTURY 

to  importation  from  Brazil  and  Paraguay.     The  amount  of 
these  imports  for  1907  was  as  follows  : — 

Pounds.  Value. 

Mate  imported  from  Brazil    100.189,162      £1,000,364 

„        Paraguay  ...  6,654,276  61,182  , 


Total  of  imported  mate          ...       106,843,438       £1.061.546 
Importation  in  1906       £970,154. 

We  have  no  information  respecting  the  national  produd 
tion  of  mat^,  but  we  have  every  reason  to  suppose  that  1 
does  not  exceed  11,000.000  lb. ;  that  is,  between  a  ninth  ant, 
a  tenth  of  the  quantity  consumed.  There  is  thus  a  vas 
field  of  development  for  this  branch  of  agriculture,  es-peciall 
in  the  Territory  of  Misiones,  which  offers  all  the  condition' 
favourable  to  the  culture  of  the  plant.* 

Encouraged  by  these  figures,  and  by  the  desire  to  replac 
the  forests  of  ilex,  destroyed  by  improvident  exploitatioi 
attempts  have  been  made  to  develop  the  culture  of  mate^ 
and  the  first  results  appear  to  augur  well  for  the  future  (• 
this  undertaking. 

M.  Thays,  Director  of  the  Parks  and  Promenades  of  Buem 
Ayres,  to  whom  we  owe  the  floral  and  arboreal  embellishmei 
of  the  Argentine  metropolis,  was  the  first  to  overcome  tl 
obstacles  to  the  artificial  culture  of  the  mate  shrubs  from  tl^ 
seed. 

The  development  of  the  plant  is  fairly  rapid  ;  the  plucj; 
ing  of  the  leaves  may  be  commenced  at  the  end  of  six  yeai 
and  sometimes  earlier :  the  treatment  necessary  for  i 
cultivation  is  very  much  that  demanded  by  ordinary  orcha 
trees.  Its  longevity  is  great,  and  so  far  it  is  not  known  to 
subject  to  any  disease. 

The  cultivation  of  mate  may  spread  beyond  the  Territo^ 
of  Misiones,  into  the  favourable  soil  of  Corrientes,  Chai 
and  Formosa  ;  possibly  into  other  parts  of  the  northern  a 
central  regions;  and  it  may  give  way  to  a  more  intensi^ 
culture.  M.  Thays  has  obtained  specimens  of  mate  frd 
seed  in  the  Botanical  Garden  of  Buenos  Ayres,  where  he  li 
grown  it  in  the  open  air. 

*  See  La  Culture  des  Plantes  industruUes  dans  la  RipubJtque  Argentine,^ 
Carlos  Girola. 


"' 


AGRICULTURAL  INDUSTRIES  1 99 

Cotton. — Of   the   various    territories   of   the   Arcrcntine, 

nne  leud  themselves  so  well  as  Chaco,  Formosa,  and  INliaioii^s 

ii  the  cultivation  of  the  cotton-plant;  not  only  by  reason 

it    <■   their  climatic   conditions,   but   also   on   account  of    the 

■    (imposition  of  their  soil. 

i'  The  cotton-plant  is  indigenous  to  the  islands  and  sea- 
casts  of  the  Tropics,  and  its  geographical  limits  of  cultiva- 
[Du,  on  either  side  of  the  Equator,  run  to  40°  of  latitude  in 
?K(  ^e  north,  and  in  the  south  to  about  30°,  but  never  as  far 
tli  f'Uth  as  35°  or  40°,  in  spite  of  the  probable  suitability  of 
itl   tose  latitudes. 

The  plant  hardly  suffers  from    the  greatest   heats  of  a 

;     t  jpical    summer,    while    very   cold    weather   interrupts   its 

iilii.  cganic  functions.     It  requires  a  hot,  moist  atmosphere  for 

,  is  development,  but  the  moisture  must  not  be   excessive, 

rtf  I  the  plant  will  grow  too  rapidly. 

)itr,   I   It   is  doubtless  thanks  to  these   natural  conditions  that 

[e  itton-planting  attained  to  a  certain  degree  of  development 

it:  i.  the  Territories  of  Chaco,  Formosa,  and  Misiou^s  as  soon 

the  tillers  of  the  soil  became  aware  of  its  profitable  nature. 

The  cultivation  of  this  valuable  textile  is  not,  however, 

isk  ^w  to   this   country.     It   was   grown  long   ago,  chiefly   in 

)i  lisiones,  during  the  administration  of  the  Jesuit  Fathers, 

ri  jho  made   from   it  cloth   for  their   own   use,  and   also  for 

irposes  of  trade.     But  with  the  expulsion  of  the  members 

the    celebrated    Company    of    Jesus,   and   the   resulting 

J I    (ipopulation  of  the   countryside,   decadence   overcame  this 

j(i   ranch  of  agriculture,  and  finally  an  almost  total  extinction, 

dtt;  ptil  to  the  people  of   the  country  it  was  no  more  than  a 

n\   memory. 

Finally,  in  1894,  cotton  was  sown  as  an  experiment  in 
ijjfj  le  Territory  of  Formosa;  a  few  grains  of  the  "Louisiana" 
^  g  id  "  Sea-Island  "  types,  brought  from  the  United  States, 
^j„  The  results  were  excellent,  and  encouraged  the  sowing 
jj(({  f  larger  areas.  There  are  now,  in  the  various  colonies 
jl^(  punded  in  Chaco,  which  grow  practically  nothing  but  cotton, 
jjIj,  bme  13,600  acres  under  cotton.  It  may  to-day  be  asserted, 
iiys  an  official  report,  that  Chaco  is  in  the  van  of  the 
i^public  in  the  production  of  cotton ;  by  reason  of  the  area 
•     ader   cultivation,  the    quantity    of   cotton   picked   at  each 


200    THE  ARGENTINE  IN  THE  20th  CENTURY 

harvest,  and  the  importance  of  its  trade  with  the  Buen 
Ayres  market.*  In  the  short  space  of  two  years,  from  Maii 
1902  to  March  1904,  the  exports  from  Barranqueras,  ts 
port  of  this  region,  amounted  to  850,564  lb.  of  cotton  a  I 
286,831  lb.  of  cotton-seed.  From  this  we  may  well  aug, 
as  the  above-mentioned  report  asserts,  that  Chaco  will  beco:) 
a  great  cotton-producing  country,  on  condition  that  varifj 
refractory  factors  are  eliminated.  I 

That  the  reader  may  form  some  idea  of  the  future  ii. 
store,  during  the  economic  development  of  the  Argenti:, 
for  the  cultivation  and  exploitation  of  cotton,  he  need  oi; 
refer  to  the  following  calculation  as  to  its  results.  The  lal 
in  Chaco  given  over  to  cotton  yields,  in  good  years,  i 
average  crop  per  acre  of  1785  lb.  of  cotton  "in  the  pod'- 
that  is,  fibre  and  seed  together.  Selling  the  cotton  at  ii 
very  low  price  of  •96d.  per  lb. — and  the  present  price  f 
cotton  runs  to  116d.,  l"44d.,  and  l-65d.  per  lb. — the  minimvi 
yield  would  be  £7,  2s.  per  acre,  even  with  prices  as  lows 
we  have  indicated.  As  for  working  expenses,  they  do  it 
exceed  £4,  5s.  6d.  per  acre,  unless  by  some  trifling  sii, 
according  to  locality ;  so  that  the  average  profit  would  e 
about  £2,  16s.  per  acre. 

This  is  the  cost  of  production  of  an  acre  planted  wa 
cotton  during  the  first  year.  Later  the  expenses  diminli 
by  25  per  cent.,  so  that  the  net  profit  might  reach  £3,  lis.  I. 
per  acre. 

One  of  the  great  obstacles  in  the  way  of  the  full  deveL  - 
ment  of  this  industry  is  to  be  found  in  the  lack  of  hai  s 
indispensable  for  the  minute  and  delicate  operations  connec;i 
with  gathering  the  crop.  It  has  even  happened,  during  le 
last  few  years,  that  in  certain  districts  as  much  as  3s.  7d.  ]  r 
cwt.  has  been  offered  for  selected  cotton,  and  in  others  s 
much  as  a  third  of  the  results  of  the  harvest.  But  e 
may  be  sure  that  when  the  native  farmer  and  the  forein 
agriculturalist  once  awaken  to  the  extraordinary  pros 
which  cotton  yields,  its  production  will  assume  a  i 
larger  scale. 

*  See  the  notable  monograph  entitled :  Investigaciones  algodeneras  en  )■' 
territorios  del  Chaco,  Formosa  y  Misiones,  ano  1904,  by  the  agronon  al 
engineer,  Fidel  Macial  Perez,  npon  whoso  data  we  have  drawn  for  this  bool 


'  AGRICULTURAL  INDUSTRIES  201 

"  I  Aa  the  growers  have  to  deal  with  nn  industrial  branch 
'  f.  agriculture  in  process  of  establishment  it  has  not  yet  been 
^'  ^jssible  to  draw  from  it  all  the  profit  that  is  secured  in 
*  )iher  countries :  cotton-seed,  for  example,  in  the  United 
^''  states  especially,  is  a  considerable  source  of  wealth,  but 
^  fi  the  Argentine  the  growers  have  scarcely  begun  to 
''^  Itilise    it    by   the   extraction   of   its   oil.      But   there   is   a 

"jginning:  several  mills  have  lately  been  established  for 
'"'  Ilia  purpose.  The  agronomic  expert  Macial  has  justly 
P'  imarked  that  we  only  require  spinning-mills  and  looms 
■''  <>r  the  cycle  of  the  cotton  industry  in  Chaco  to  attain  its 
^'  ftmpletion. 

^^  '  Rubber. — Another  source  of  forestal  wealth  in  the 
F  .rgentine,  and  one  which  is  for  the  moment  unexploited, — 
'i  j-incipally  because  of  local  depopulation  and  a  lack  of  means 
™  <j  transport — is  the  extraction  of  the  rubber  contained 
^  i  certain  tropical  plants. 

li"  I  Lately,  for  example,  competent  observers  have  discovered 
<i«  iat  the  true  rubber-plant,  the  Ficus  elastica,  exists  in 
I'-  Sundance  in  the  north-east  of  the  Republic,  and  in  the 
i  tovinces  of  Salta  and  Jujuy,  between  23°  and  26°  of  south 

Ititude,  and  62°  and  66°  of  west  longitude.     It  is  this  tree 
i'  )hich  has  given  such  value  to  the  Brazilian  territory  of  Acre 
IE  ilid  to  various  other  regions  of  Brazil. 
Hi  i    Various   plants  yield   rubber :    one   species,  of   a  family 

iiown  as  "  lecherones,"  grows  in  the  darkest  and  dampest 
eii  -i^rts  of  the  forest ;  others,  called  "  heveas  "  in  Brazil,  are 
a  inch  thinner  in  the  stem ;  and  finally  there  is  a  third  kind, 
118  le  "  liane  "  or  rubber  vine. 

k  i  The  first  variety,  that  of  the  "  lecherones,"  gives  a  yield 
li  I:  17^  to  22  lbs.  of  gum  per  annum  ;  there  are  forest  lauds 
B  ii»ntaiuing  as  many  as  50,000  plants  to  the  square  league — 
ii!  ^7er  5000  to  the  square  mile — while  the  poorest  districts 
k  reduce  2000  to  the  league.  Considering  the  present  high 
|t  Hces  of  rubber,  we  may  obtain  some  idea  of  the  great 
j   jealth  of  this  region.     The  method  of  exploitation  is  easy 

iid  simple ;   the   country  is  indubitably  healthy,  and  with 

jbourers   paid  at  the   rate   of   3s.  7d.   to   ISs.  9d.  a  day  a 
"'  onaiderable  profit  would  remain. 
1^  1    To-day  men   of  initiative  are  busily  seeking  to  exploit 


202    THE  ARGENTINE  IN  THE  20th  CENTURY 

this  new  source  of  forestal  wealth,  which  ought  in  tim 
to  become  another  centre  of  attraction  to  men  and  t< 
capital. 

Arboriculture. — There  is  another  kind  of  culture  which  i* 
destined  in  the  future,  although  at  present  it  has  only  th; 
smallest  importance,  to  become  an  industry  of  considerabi 
moment ;  the  culture,  namely,  of  orchard  trees,  of  which  w 
must  mention  the  rapid  progress.  Given  the  immense  area  c 
Argentine  territory,  endowed  with  the  most  varied  climatei 
from  the  snows  of  Tierra  del  Fuego  to  the  semi-tropical  hea 
of  Corrientes  and  Jujuy ;  from  the  temperate  warmth  of  tb: 
coast  to  the  more  relaxing  temperatures  of  the  mountaic 
of  Cdrdoba  or  the  Andean  frontier,  and  containing  Ian 
at  all  altitudes  above  the  level  of  the  sea,  it  is  not  to  I 
wondered  at  that  all  the  fruit-bearing  trees  of  the  worl 
can  live  and  flourish  in  the  Republic. 

In  the  northern  region,  and  especially  in  Corrientfe 
Tucuman,  Salta,  La  Rioja,  Catamarca,  Jujuy,  Formos. 
Chaeo,  and  Mision^s,  there  are  to-day  groves  of  orange 
mandarins,  lemons  and  limes  of  various  kinds,  figs,  an 
pomegranates.  At  Tucuman  and  Salta  "  chirimoyos "  an' 
"  paltas "  are  cultivated.  Almonds,  olives,  Barbary  fig 
ananas  or  bread-fruit,  bananas  and  "  guayabos "  may  al' 
be  grown  in  this  region;  but  unhappily  the  fruit-growic 
industry  is  at  a  standstill,  on  account  of  the  lack  of  laboi 
which  is  so  great  a  difficulty  in  all  departments  of  tl 
industrial  and  economic  life  of  the  Argentine. 

In  the  central  region  we  also  find  the  mandarin  ( 
tangerine  (in  the  north  of  Entre  Rios  and  Santa  Fe),  lemoi 
(in  Entre  Rios,  Santa  F6,  and  Buenos  Ayres),  the  grape- vin 
especially  in  Mendoza  and  San  Juan,  and  also  in  La  Rioj 
Salta,  Catamarca,  Cdrdoba,  Santa  F^,  Entre  Rios,  ar 
Buenos  Ayres.  Peaches,  prunes,  apricots,  cherries,  apph 
pears,  quinces,  medlars,  and  figs  are  grown  in  all  the 
districts,  and  chiefly  in  the  Province  of  Buenos  Ayres,  ar 
the  islands  of  the  delta  of  the  Parana,  In  the  same  regi( 
we  also  find  almonds,  walnuts,  hazel-nuts,  and  chestnu' 
but  grown  on  a  small  scale  only.  There  is  a  fair  producti( 
of  lemons ;  and  the  olive  grows  well  under  favourafc 
conditions. 


AGRICULTURAL  INDUSTRIES  203 

In  the  southern  region  there  is  no  fruit  grown,  except  on 
a!:ew  estates  in  the  Rio  Negro  and  in  the  valley  of  Chubut. 
\.t  peaches,  apricots,  prunes,  cherries,  apples,  and  pears  will 
f  urish  in  certain  localities ;  while  walnuts,  filberts  and 
cestnuts  might  be  grown  on  an  enormous  scale  on  the 
i'jidean  slopes,  where  the  rains  are  more  frequent  and  the 
a;nosphere  more  humid. 

Up  to  the  present  time,  on  account  of  the  large  profits 
mde  by  those  engaged  in  agriculture  and  stock-raising,  and 
aove  all  on  account  of  the  insufficiency  of  the  population, 
yiich  is  the  prime  cause  of  which  we  have  already 
soken,  the  industry  of  fruit-farming  has  been  practically 
isiored,  and  what  little  has  been  undertaken  has  followed 
n  definite  plan,  such  as  the  careful  selection  of  stocks 
aid  slips  and  saplings,  the  preparation  of  the  soil,  and 
te  efficient  protection  of  the  trees.  But  in  spite  of  all, 
\,ry  satisfactory  results  have  been  obtained,  which  have 
rvealed  the  fertility  of  the  soil  and  the  excellence  of  the 
cmate. 

,  But  quite  lately  we  have  seen  a  remarkable  development 
i]|this  branch  of  agriculture,  which  seems  to  promise  a  fruit- 
gowing  industry  comparable  to  that  of  other  and  more 
avanced  countries  than  the  Argentine.  To-day,  according 
t  Girola,*  more  care  is  expended  upon  the  planting  and 
Ciltivation  of  the  trees,  as  the  growers  have  acquired 
tp  conviction  that  it  is  better  to.  produce  quality  rather 
tin  quantity,  and  that  fruit  -  growing  demands,  like 
clier  departments  of  agriculture,  the  careful  selection  of 
virieties  at  the  time  of  planting ;  as  well  as  incessant 
improvement  by  means  of  careful  grafting,  and  the 
aiplication  of  special  procedures  to  the  elimination  of 
r,xious  insects,  and  the  prevention  of  parasitic  or  other 
liladies. 

1  This  being  the  case,  it  follows  that  the  fruit-farmer  is 
^;adually  acquiring  rational  methods,  which  will  soon  attest 
tj  their  beneficent  influence  by  transforming  the  old  orchard- 
j^ntations,  which  were  with  reason  described  as  forests  of 

[*See  the  chapter  Arbres  Fruitters  in  the  fnvttipation  ayricole,  by  0.  P. 
Cfola,  reproduced  in  the  Annates  de  la  Sociiti  Rurule  Argentine  for  J anuarj- 
Ifaruary  1905. 


204    THE  ARGENTINE  IN  THE  20th  CENTURY 

fruit-trees,  into  gardens  of  carefully  cultivated  planti 
yielding  crops  very  greatly  improved  in  the  matter  c 
quality  and  the  beauty  of  the  fruit.  On  the  other  ham 
the  sellers  of  fruit-trees  have  at  the  same  time  been  learnin 
more  as  to  the  qualities  of  different  varieties,  and  how  bes 
to  select  them,  in  order  to  place  on  the  market  those  whic 
will  secure  the  largest  profits  to  the  grower,  and  to  propagat 
the  most  popular  species. 

The  cultivation  of  fruit-trees  is  far  from  occupying  ii 
proper  rank  among  Argentine  industries.  It  is  distribute 
in  an  irregular  fashion  ;  some  kinds  of  fruit-trees  abound  i 
certain  districts  and  are  rare  or  unknown  in  others ;  and 
is  impossible  for  growers  in  the  latter  districts  to  obtai 
them  at  profitable  rates,  on  account  of  the  difficulty  ar 
scanty  means  of  transport. 

As  for  the  fruit  trade,  it  has  hitherto  been  very  limite 
and  confined  almost  exclusively  to  the  sale  of  fresh  fru 
as  with  the  exception  of  the  factory  of  the  "  Tiger  Packii 
Company  "  and  a  few  others,  which  prepare  canned  peachy 
etc.,  in  syrup,  all  growers  of  fruit  for  public  consumpti( 
offer  it  for  sale  only  in  the  fresh  state. 

Yet  amid  the  feverish  activity  which  characterises  t 
present  situation  in  the  Argentine,  the  fruit  trade  receives 
greater  impulse  each  year ;  not  only  in  the  matter  of  hoi 
consumption,  which  has  been  popularised  by  the  aid  of  su;. 
companies  as  the  "  Co-operative  Fruticola,"  which  endeavoii 
to  supply  the  consumer  with  articles  of  the  first  quality  . 
reasonable  prices,  but  also  in  the  matter  of  export  to  lar; 
foreign  cities.  The  export  of  fresh  fruit  should  soon  form  i 
important  branch  of  commerce  in  the  Argentine,  as  it  d(i 
already  in  the  United  States  and  in  other  countries. 

In  the  matter  of  a  fresh-fruit  trade  with  foreign  countr.) 
the  Argentine  is  particularly  favoured  by  circumstances;  ir 
on  account  of  her  geographical  position  she  is  able  to  prct 
by  the  inversion  of  the  seasons  with  regard  to  Europe  ;  tl  b 
is,  by  placing  summer  fruits  on  the  European  markets  i 
the  middle  of  the  northern  winter.  Another  advant?J 
which  the  Argentine  will  enjoy  on  these  markets  is  13 
fact  that  she  has  to  reckon  with  no  formidable  competito  ; 
for  those  countries  that  might  dispute  her  place,  such  s 


AGRICrLTURAL  INDUSTRIES  205 

j 

''  [South  Africa,  which  is  situated  in  Diuch  the  sanu'  latitude, 
*■  pr  Chili,  which  grows  a  variety  of  good  fruit,  have  not  the 
l*  Lbundaut  fertility  of  the  Republic ;  or  if  they  run  her  close 
''■'  [n  this  respect,  as  is  the  case  with  Chili,  they  are  separated 
'  lirom  Europe  by  a  greater  distance,  which  considerably 
"  ncreases  the  price  of  transport.* 
f!         Profiting  by  the  admirable  physical  advantages  of  the 

pountry,  once  this  trade  has  obtained  the  indispensable 
k  lissistance  of  rapid  and  convenient  steamers,  with  special 
i!i;  tiolds  or  refrigerating  chambers  for  the  storage  of  large 
^'-  |uantities  of  fresh  fruit,  we  are  certain  that  it  will  not  have 
Ji    Jong  to  wait  for  profitable  results. 

i  I     Several  years  ago  one  of  the  authors  of  this  book  sent 
tji  [o  Messrs  Garcia,  Jacobs  &  Company,  of  London,  as  a  com- 

'nercial  sample,  a  batch  of  peaches  preserved  by  chilling, 
li  ind  according  to  the  testimony  of  these  merchants  the 
hii  Reaches  of  Buenos  Ay  res  may  well  be  the  subject  of  a 
'ad  (uccessful  business,  provided  that  fruit  of  the  superior 
pesi  varieties  be  produced.  Entering  into  detail,  Messrs  Garcia 
^  jj   Jacobs    added    that    the    best    qualities    sent    had    sold 

atisfactorily ;  they  ended  by  stating  that  consignments 
w  teaching  London  in  the  months  of  March,  April,  and  May 
m  mould  yield  considerable  profits. 

ik  I  After  this  experiment  many  others  were  made  by  various 
oii  ersons,  until  finally,  thinking  the  moment  had  come  for 
\m  ptablishing  the  fruit  trade  on  a  solid  and  lasting  basis,  the 
aalii;  poyal  Mail  Steam  Navigation  Company  determined  to  tit 
to'i  heir  steamers  with  special  "  chilled  "  chambers  or  holds  for 
k  be  transport  of  fresh  fruit. 
jiti  j    The  first  consignments  have  not  been  completely  sutis- 

ftctory,  as  in  this  trade,  which  is  now  being  undertaken  on 
toil  I  very  large  scale,  every  one  has  a  great  deal  to  learn  ;  from 
ttces:  jie  producer,  who  plants  the  varieties  of  fruits  which  he 
tflji  iiinks  most  suitable  for  export,  the  farm  labourer,  who 
,pe;;  kthers  the  fruit,  and  the  man  who  packs  it  in  special  cases, 
gl$  [own  to  the  steamship  company,  which  has  to  confide  the 
^yju  kre  of  the  refrigerating  plant  and  the  holds  to  a  com- 
{jis  ptent  technician,  whose  duty  it  is  to  maintain  a  constant 

OpBW      ♦  And  also  of  refrigeration  ;  tho  fruit  bcinjj  "  chilled, "  that  Ib,  kept  slightly 
jOlli  ^OTe  freezing  point. — [Thanh.  J 


206    THE  ARGENTINE  IN  THE  20th  CENTURY 

temperature,  appropriate  to  each  species  of  fruit.  But  even 
under  these  still  imperfect  conditions  the  progress  achieved 
has  been  very  remarkable,  and  justifies  our  assertion  that  a 
large  export  trade  in  fresh  fruit  is  perfectly  practicable. 

The  exhibitions  of  fruit  which  the  Government  of  the 
Republic  organises  annually,  with  much  practical  good  sense, 
have  greatly  helped  to  attract  attention  to  the  fruit-growing 
industry,  and  at  the  same  time  to  stimulate  competition; 
and  improvement.  These  exhibitions  have  been  a  veritable 
revelation  to  everybody,  for  very  few  people  suspected  that 
the  Argentine  produced  so  great  a  variety  of  the  best  species, 
of  fruit-bearing  trees ;  or  that  she  could  rival  other  countries 
in  the  matter  of  production. 

The  fresh-fruit  trade  is  not,  in  the  Argentine,  as  it  is  iri 

the  United  States,  favoured  by  the  existence  of  refrigerato:; 

cars,  placed  at  the  disposal  of  the  producers  by  the  railwa;; 

companies,  and  capable  of  transporting  enormous  quantitie 

of  fruit  from  one  end  of  the  country  to  the  other.     But  thi 

innovation,  like  so  many  others  demanded  by  industry  an. 

commerce,    will   come    in    time,   when    the   population  hs 

increased,  and  new  markets  will  be  permanently  opened  i 

the   producer.      At   the   present   time  such    fruits    as    ai 

intended    for    home  consumption,  like    those    selected    f( 

exportation,  have  not   far   to  travel  before  reaching  the 

destination,  as  they  are  usually  grown  near  Buenos  Ayre 

particularly  the  peach,  which  is  the  fruit  most  m  demand  (^ 

account  of  its  superior  quality.  i 

Although   the    entire    Argentine    territory   lends    its. 

admirably  to  the  production  of   fruit,   there    are   particu 

districts   which   by   nature     are    especially    fitted    for    t 

plantation  of  fruit-trees.     Among  such  districts  we  may  c; 

the  islands  which  form  the  delta  of  the  Parana,  which  jh 

covered  with  an  extremely  rich  soil  and  magnificent  growt . 

and  are  irrigated  during  certain  seasons  of  the  year  by  U 

waters  of  the  river,  which  deposit  on  them  a  richly  nutriti^ 

silt,  like   that  which  the  famous  waters  of   the   Nile  leij 

upon  its  Egyptian  banks.     There  flourish  a  great  varietj 

fruit-trees,  from  peach  and  apricot,  pear  and  apple,  fig  il 

quince,  down  to  the  "diospiro  kaki,"  and  many  other  specs. 

Another  region  which  has  commenced  to  attract  attenin 


AGRICULTURAL  INDUSTRIES  207 

I  i,  • 

by  reason  of  its  magnificent  fruits  is  that  of  the  Rio 
Colorado ;  it  will  one  day  be  as  famous  for  its  peaches  and 
apricots  as  California  is  to-day.  At  a  short  distance  from 
Buenos  Ayres  is  another  favoured  district,  producing  in 
especial  magnificent  peaches ;  it  is  that  of  the  village  of 
Dolores,  in  the  Province  of  Buenos  Ayres,  whose  exquisite 
truits  figure  on  the  best  tables  of  London  and  other  European 
capitals. 

I  As  we  see  from  these  data,  fruit-farming  is  making  rapid 
progress  in  the  Argentine :  it  may  succeed  in  time  in 
capturing  not  only  the  home  markets,  but  also  the  most 
important  foreign  markets. 

As  for  the  preparation  of  fresh  fruit  in  syrup,  as  well 
b.s  the  manufacture  of  dried  fruits,  both  of  them  industries 
well  developed  in  the  United  States,  they  still  exist  in  the 
Argentine  only  in  a  rudimentary  condition  ;  but  in  view  of 
ihe  rapid  progress  achieved  each  year  in  the  Argentine,  in 
this  as  in  other  industries,  we  may  hope  that  they  will  soon 
develop  and  establish  themselves  securely. 


PART  III 

THE  ARGENTINE  FROM  THE  COMMERCIAL 
AND  INDUSTRIAL  POINT  OF  VIEW 


It 


CHAPTER  I 

FOREIGN   TRADE 

Th»  important  part  played  by  tho  foreign  trade  of  the  Argentine — Table  of 
imports  and  exports  during  recent  years — Explanation  of  their  r«spectiv« 
movements — Favourable  condition  of  tho  commercial  balance. 

Method  of  ascertaining  the  statistics  of  exports  and  imports  —  Errori  in 
evaluation — Notes  on  the  import  duties  on  various  articles — Variations  of 
the  customs  duties  —  Export  duties  ;  their  transitory  character  —  Th« 
trade  in  bullion. 

Imposts — Their  classification  according  to  their  countries  of  origin — Value 
of  imports  from  each  country,  with  indications  of  the  principal  articles  im- 
ported— The  Argentine  dependent  upon  other  countries  for  a  large  number 
of  manufactured  articles — Concentration  of  imports  at  Buenos  Ayres. 

Exports — Their  classification  according  to  origin — Value  of  exports  from 
each  district,  with  indications  of  tho  chief  articles  exported — Decadence 
of  the  French  trade  with  the  Argentine  and  its  causes. 

Tabolation,  according  to  importance  of  the  principal  products  exported  by 
the  Argentine  —  Remarkable  increase  in  agricultural  and  pastoral  ex- 
ports— Search  for  new  outlets. 

Eventual  denunciation  of  commercial  treaties  —  Projected  new  treaty  with 
Franco  —  Causes  of  the  superiority  of  English,  German,  and  North 
American  trade  in  the  Argentine  over  French  trade. 

"Dumping"  in  the  Argentine — A  new  client  for  the  Argentine — Japan — 
Elements  which  make  for  the  development  of  commercial  activity  in  the 
Argentine. 

The  commercial  balance — Results  of  the  commercial  balance — Its  prime  im- 
portance in  respect  of  tho  prosperity  of  the  country — It  is  this  balance 
which  compensates  the  issue  of  capital  for  the  benefit  of  the  foreign  debt. 

THE  whole  activity  of  the  Argentine  Republic  is  reflected 
in  the  statistics  of  its  external  commerce,  which  gives 
the  true  measure  of  its  prosperity.  All  the  vital  forces  of  the 
country,  its  river  traffic-ways,  its  railways,  its  ports,  its 
business  centres,  all  aid  in  the  development  of  the  commercial 
movement,  which  lives  only  by  means  of  international 
exchange.     We  have  thus  reached  one  of  the  mot-t  important 


212    THE  ARGENTINE  IN  THE  20th  CENTURY 

poiuts  of  our  study :  that  from  which  we  can  best  judge  the 
place  held  by  the  Argentine  among  the  great  markets  of  the 
world. 

Considered  under  its  general  aspect  Argentine  commerce 
maj''  be  summed  up  as  follows :  the  exportation  of  raw 
materials  and  the  importation  of  manufactured  articles.  We 
mention  exportation  first  by  design ;  for  it  is  the  exports,  as 
we  have  already  pointed  out,  that  regulate  the  purchasing 
power  of  the  country.  There  are  no  reserves  in  the  Argentiue 
which  permit  the  country  to  preserve  its  power  of  purchase 
much  in  excess  of  the  movement  of  capital  produced  by  the 
sale  of  the  harvest. 

This  situation  cannot  be  clearly  expressed  in  figures ;  for 
we  can  prove  that  as  late  as  1891  the  sum  of  imports  was 
greatly  in  excess  of  that  of  exports.  In  normal  periods  one 
must,  in  fact,  take  into  account  a  new  factor;  namely 
external  credit,  which  allows  the  Argentine  to  increase  bei 
power  of  purchase  above  her  actual  resources.  When,  on  the 
contrary,  a  crisis  arises,  the  imports  rapidly  follow  the  move- 
ment of  the  exports,  the  country  no  longer  being  able  tc 
depend  upon  credit  nor  to  cover  by  loans  its  unfavourabk 
commercial  balance. 

We  give  below,  taken  from  the  publications  of  M.  Latzina 
the  statistics  of  foreign  trade  since  1861,  which  is  the  firs 
year  included  in  the  oSicial  statistics. 

The  foreign  trade  of  the  Argentine  has  passed  througl 
two  distinct  phases;  from  1861  to  1890  the  import 
were  usually  larger  than  the  exports ;  while  since  189 
the  exports,  except  in  1893,  have  been  considerably  th' 
larger. 

It  is  curious  to  note  that  this  reversal  took  place  after  th 
year  1890  ;  that  is,  after  the  financial  crisis  which  so  violent!; 
shook  the  country,  and  deprived  it  of  that  external  credi 
which  had  hitherto  balanced  the  insufficiency  of  exportation 
In  1891  the  imports  fell  to  £13,441,400,  from  £28,448,001 
or  a  fall  of  more  than  50  per  cent,  from  one  year  to  th 
next.  Thenceforward  the  imports  progressively  increased  t 
£37,400,000  in  1904  , varying  by  a  few  millions  each  yea 
while  the  exports  reached  their  present  high  state  ( 
development  through  the  progress  achieved  by  agricultur 


FOREIGN  TRADE 


864 


869 


873 
674 
376 
?76 
J77 
378 
379 
?80 
881 
1,  or,  882 
le  Di!;  383 
■  M  884 
'*     385 

mm.   886 

B87 


889 


896 
897 


905 
906 
907 

iclji   908 


Lomnierci»l 

Population. 

Imports. 

Kxports. 

Balance. 

1.375,481 

£4,488,224 

£2,864,518 

_ 

£1,623,706 

1,424,740 

4.627,742 

3,830,268 

- 

797,474 

1,477,042 

5,473,939 

4,317,689 

- 

1,156,250 

1,530,954 

4,628,648 

4,473,462 

- 

156,186 

1,387,101 

6.056,661 

5,225,288 

- 

831,573 

1,645.430 

7.480,097 

5,348,154 

- 

2,131,943 

1,706,159 

7,7.58.439 

6,639,223 

- 

1,119,216 

1.769,379 

8.480,508 

5,041,942 

- 

2,538,566 

1,836,490 

8,239,140 

6.489,637 

- 

1,749,303 

1,882,615 

9,824,922 

6.044,617 

- 

3,780,305 

1,936.569 

9,135,821 

5,390,300 

- 

3,736,461 

1,989,880 

12,317,150 

9,453,593 

- 

2,803,563 

2,045.028 

14,686,807 

9,470,658 

5,207,149 

2,102,284 

11,. 56.5,309 

8.008,307 

- 

2,657,002 

2,161,639 

11,524,896 

10,401,822 

- 

1,123,073 

2,223,189 

7,214,004 

0,618,142 

+ 

2,404,1.38 

2.287,005 

8,088,684 

8,053,988 

+ 

865,304 

2,3.53,194 

8,751,825 

7,504.754 

- 

1,247,071 

2,421,827 

9,272,718 

9,871,511 

+ 

598,793 

2,492,866 

9,107,176 

11,676,157 

+ 

2,564,981 

2,565,040 

11,141,185 

11,587,654 

+ 

446,469 

2,639,573 

12,249,209 

12,077,788 

- 

171,421 

2,716,836 

16,047,105 

12. 641,. 595 

- 

4,045,570 

2,797,042 

18,811,229 

13,605,067 

- 

5,2^5,261 

2,880,111 

18,444,304 

16,775,820 

- 

1,668,574 

2,966,260 

19,081,749 

13,966,068 

- 

5,114,781 

3,056,835 

23,470,425 

16,884,164 

- 

6.586,061 

.3,158,914 

25,682,422 

20,022,380 

- 

5,660,041 

3,265,577 

32,913,976 

18,029,071 

- 

14,884,960 

3,377,780 

28,448,162 

20,163,798 

- 

8,284,364 

.3,490,417 

13,/41,5.56 

20,643,800 

+ 

7,202,244 

3.607,103 

18,^.232 

22,674,067 

+ 

4,377,830 

3,729,105 

19,244,725 

18,818,032 

- 

426.694 

3,856,728 

18,5.57,725 

20,337,597 

+ 

1,779,872 

3,984,911 

19,019,287 

24,013,560 

+ 

4,094,270 

4,084,183 

22,432,718 

23,376,403 

+ 

927,685 

4,186,267 

10,657,780 

20,233,850 

+ 

576,070 

4,291,575 

21,485,780 

26,705,801 

+ 

5,280,111 

4,400,226 

23,-370,134 

36,083,506 

+ 

13,611,152 

4,512,342 

22,607,'>14 

30,920,082 

+ 

8,223,068 

4,625,150 

22,791,040 

33,543,220 

+ 

10,751,271 

4,741,780 

20,007,851 

.35,807,345 

+ 

15,289,494 

4,860,324 

26,241,320 

44,106,905 

+ 

17,955,585 

4,981,832 

37,461,104 

52,831,505 

+ 

15,370,311 

5,214,074 

41,030,884 

64,508,768 

+ 

23,537,884 

5,377,639 

.53,904,104 

58,4.50,766 

+ 

4,456.662" 

5,546,106 

57,172,136 

50,240,874 

+ 

2,068,738 

5,712,489 

54,594,547 

73,201,068 

+ 

18,706,521 

ToTAi.8  ..         £887.142,003      £904.278,951  +£77,130.010 


214    THE  ARGENTINE  IN  THE  20th  CENTURY 


k 

iistisni 


For  the  explanation  of  these  data,  we  must  remember  that 
during  the  last  twelve  years  the  population  has  increased 
only  by  about  one  million  inhabitants,  and  that  in  consequence 
the  power  of  consumption  of  the  Argentine  could  only  become 
modified  to  a  certain  extent.  If  we  except  certain  periods  of 
exceptional  importations,  referring,  for  instance,  to  the  entry 
in  bulk  of  large  amounts  of  raw  material  for  the  construction 
of  new  railways,  we  see  that  the  imports,  as  compared  to  the 
bulk  of  the  population,  represent  from  £5,  5s.  to  £7,  18s.  7d.  jliiis 
per  head,  while  the  same  figure  for  exports  is  £7,  10s.  7d.  to  m%  T 
£10,  12s.  Od.,  according  to  the  condition  of  agriculture.  J|j«Mji 

If  we  now  examine  the  recent  results  of  foreign  trade,  we 
find  the  situation  summed  up  by  the  following  figures  for  fli|Diis 
1908,  as  compared  with  1907,  1906,  and  1905  :—  |   Ik 

Imvei 
im 


1908 

1907 

1906 

1905 

Exports... 

...   £73,201,068 

£59,240,874 

£58,450,766 

£64,568,768 

Imports  . . . 

...     54,594,547 

57,172,136 

53,994,104 

41,030,884 

Excess  of  Exports  £18,606,521  £2,068,738  £4,456,662         £23,537,884 

The  commercial  balance  in  1908  was  thus  £18,606,521  in 
favour  of  the  exports,  as  against  £2,068,738  in  1907, 
£4,456,662  in  1906,  which  latter  sum  was  £19,081,222 
less  than  in  1905. 

There  is  every  reason  to  believe  that  the  exports  for  1909  i 
will  prove  to  have  been  fully  as  large  as  the  year  before,  for 
the  recovery  of  the  wool  market  and  the  enormous  maize 
harvest  will  have  compensated  certain  deficits  in  the  matter  ^i 
of  corn  and  cattle,  which  suffered  in  the  preceding  year  from 
frost  or  drought. 

As  for  the  harvest  of  the  current  year,  it  is  wiser  not  to 
say  too  much  at  present,  as  the  lack  of  rain  has  deranged  the 
sowing  season. 

Before  commenting  in  any  way  upon  the  figures  relating 
to  foreign  trade,  we  must  make  one  remark  in  respect  of  the 
method  followed  in  making  out  our  balance-sheets,  etc.  In 
the  case  of  imports,  the  valuation  of  the  customs  is  taken, 
and  in  the  case  of  exports  their  current  market  price  in  gold.    ;    jj^ 


But  this  procedure  has  the  demerit  of  yielding  results  which 
are  not  in  strict  correspondence  with  reality ;  the  most  we 
can  say  is  that  they  enable  us  to  make  a  strict  comparison  of 
one  year  with  another. 


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FOREIGN  TRADE  215 

The  valuations  according  to  the  customs  are  from  20 
to  30  per  cent,  above  the  true  values  in  the  case  of  the 
majority  of  articles,  and  are  sometimes  merely  fantastic. 

To  gain  some  idea  of  the  disturbing  factor  which  arises  from 
the  calculation  of  imports  upon  the  basis  of  customs  estimates, 
which  estimates  are  the  basis  of  the  figures  of  the  National 
Statistics,  we  need  only  take  the  figures  relating  to  coffee 
as  an  example.  In  1899  it  was  valued  at  30  centavos  in  gold ; 
in  1900,  at  20  ;  and  in  1902,  at  12  centavos  (7'2d.,  4-8d.,  and 
2d.).  This  decrease  of  over  5d.  in  three  years  only  enables 
one  to  judge  of  the  instability  of  this  rate  of  valuation. 

Here  are  some  examples  of  the  tariff"  paid  by  certain 
imports  into  the  Argentine. 

The  50  per  cent,  tariff"  strikes  principally  at  the  importation 
of  woven  stuff's,  carriages,  harness,  furniture,  perfumery,  ready- 
made  under-clothing,  boots  and  shoes,  hats,  and  similar  articles 
not  burdened  by  specific  tariffs,  for  there  is  a  host  of  articles 
which  pays  the  entrance  duty  in  this  way.  In  practice  this 
ad  valorem  tariff  of  50  per  cent,  frequently  becomes  a  tariff 
of  100  per  cent,  or  more,  on  account  of  the  arbitrary  nature 
of  the  customs  valuations. 

The  45  per  cent,  tariff"  aff'ects  stockings,  socks,  etc., 
exclusively. 

The  40  per  cent,  tariflf  affects  bales  of  unbleached  linen,  all 
kinds  of  cotton  cloth  and  calicoes,  dressed  leather,  articles  of 
lace  made  of  pure  silk  or  silk  mixtures,  or  of  thread ;  woollen 
blankets,  and  blankets  of  wool  with  cotton  warp,  or  bound  or 
bordered ;  also  laces  and  silk  thread  or  thread  of  mixed 
silk  and  woven  stuff's  and  any  other  articles  of  silk  or  silk 
mixtures,  including  floss  silk,  etc. 

The  35  per  cent,  tariff  applies  to  woollen  stuff's  in  general, 
whether  of  pure  wool  or  mixtures. 

The  25  per  cent.  tariflraff"ects  all  merchandise  not  burdened 
by  a  special  tax.  That  of  20  per  cent,  affects  bar,  strip  and 
ribbon  steel,  and  unbleached  cotton  cloths. 

The  15  per  cent,  tariff  affects  oak,  cedar,  pine,  spruce,  and 
tissues  of  silk  intended  for  bolting  flour.  The  10  per  cent, 
tariff  affects  certain  chemical  products,  and  also  cocoa,  tin, 
machinery  in  general,  agave  fibres,  jute,  and  hemp  fibre  for 
making  mats,  etc.     That  of  5  per  cent,  which  is  the  lowest, 


216     THE  ARGENTINE  IN  THE  20th  CENTURY 

is  imposed  on  turpentines,  steel  wire  for  fencing,  ploughs, 
jewellery,  sulphur,  cotton,  whether  raw  or  in  the  thread  for 
industrial  purposes,  sewing-thread,  sacks,  and  other  various 
articles. 

Besides  the  above  there  are  some  ninety-five  articles  or 
products  on  which  specific  duties  are  imposed. 

Since  1900  a  legislative  factor,  at  first  sight  unimportant, 
but  in  practice  of  the  greatest  advantage,  has  to  a  certain 
extent  modified  the  vexatious  character  of  the  Argentine 
tariflf.  This  factor  consists  in  the  relative  stability  imposed 
by  Congress  on  the  customs  law,  by  the  suppression  of  the 
annual  revision  to  which  the  rate  of  valuation  was  subjected, 
which  change  has  allowed  commerce  to  establish  its  trans- 
actions on  a  definite  basis;  whereas  they  were  formerly 
contingent  upon  the  continual  modifications  of  the  said  tarifi'. 
This  step,  like  so  many  others,  was  initiated  by  the  ex- 
Minister,  Senor  Jose  Maria  Rosa. 

Exaggerated  values  were  always  at  the  base  of  these 
tariffs,  and  the  abuse  became  so  notorious  that  the  present 
Minister  of  Finance,  Dr  Terry,  was  himself  obliged  to 
recognise  "that  reform  was  essential  in  the  matter  of  the 
rectification  of  all  these  valuations,  in  order  that  the  Customs 
Administration  should  not  strike  indirectly  at  imported 
products  by  taxes  far  in  advance  of  those  intended  by  the 
legislative  power."  A  new  tariff  has  been  in  force  since  the 
1st  of  January  1905,  and  although  it  also  has  given  rise  to 
a  certain  degree  of  recrimination,  it  is  none  the  less  an 
improvement  upon  the  former  state  of  aflairs.  As  for  the 
export  duties,  here  again  we  find  notable  discrepancies 
between  the  valuations  and  the  market  prices  which  ought, 
on  principle,  to  serve  as  their  basis.  They  were  established 
after  the  crisis  of  1890,  and  as  they  were  now  no  longer 
justified  by  insufficient  resources,  they  were  suppressed  by 
Congress  reckoning  from  1906. 

These  customs  duties  on  exported  goods  were  established 
by  the  Argentine  Constitution,  but  not  in  a  permanent 
manner.  The  Charter  enacted  that  they  should  be  in  force 
up  to  1866 ;  but  at  that  time,  the  country  being  at  war  with 
Paraguay,  a  Convention  was  convoked,  which  postponed  the 
settlement  of  the  matter  for  some  years. 


I 


FOREIGN  TRADE  217 

In  1887  the  export  duties  were  suppressed;  but  in  1900, 
after  the  terrible  financial  crash,  they  were  once  more 
established,  in  order  to  relieve  the  heavy  burdens  and 
engagements  of  the  Treasury. 

These  duties  were  from  4  to  100  per  cent,  ad  valorem,  and 
were  principally  directed  against  leathers  and  hides,  wool 
washed  or  unwashed,  ostrich  plumes,  tallow,  fat,  animal  oil, 
horns,  etc. 

As  may  be  seen  by  this  simple  enumeration,  these  duties 
weighed  upon  the  by-products  of  stock-raising  as  they  left 
the  country  for  the  markets  of  foreign  consumers,  and  this 
after  they  had  already  been  subjected  to  other  heavy  charges, 
in  the  shape  of  land  taxes,  customs  duties  on  wire  for  fencing, 
and  many  local  taxes,  while  agricultural  products  escaped 
scot-free.  For  this  reason  it  has  always  been  considered 
that  the  export  tariff  had  no  equitable  basis,  and  all  the 
Argentine  Administrations  have  for  this  reason  endeavoured 
to  suppress  it,  as  the  Congress  finally  did  in  1905.  Whether 
we  are  dealing  with  exports  or  with  imports  we  always  find, 
as  we  have  seen,  an  inflation  of  prices  on  both  sides,  so  that 
the  figures  of  the  official  statistics  have  not  so  much  an  actual 
as  a  comparative  value. 

There  is  still  one  important  item  to  be  remarked  in 
respect  of  imports :  it  is  that  the  import  duties  in  recent 
years  have  been  first  raised  then  lowered.  Additional  duties 
amounting  to  10  per  cent,  were  established  when  the  dispute 
with  Chili  seemed  about  to  end  in  war — that  is,  on  the  29th 
of  January  1902 — at  which  time  a  supertax  of  5  per  cent,  was 
added  to  the  tariff  which  had  already  been  in  force  since 
1899.  Since  then  these  duties  have  been  finally  suppressed 
(in  January  1904).  It  is  obvious  that  with  these  variations 
we  have  not  always  the  same  basis  of  valuation,  as  the 
imports  are  variously  affected  by  these  variations  themselves, 
so  that  all  exact  comparisons  are  impossible. 

We  must  also  take  into  account  the  value  of  the  imports 
which  are  not  controlled  by  the  customs.  Competent  persons 
have  estimated  that  these  amount  to  about  20  per  cent,  of  the 
goods  passing  through  the  customs,  which  represents  a  sum 
of  about  £2,000,000. 

Again,  the   figures   we  have  quoted  do  not  include  the 


218    THE  ARGENTINE  IN  THE  20th  CENTURY 


movements  of  currency  or  bullion,  which  during  the  last  six 
years  have  been  as  follows  : — 


Year. 

Metallic  Imports. 

Metallic  Exports. 

Balance. 

1902         . 

...       £1,781,817 

£614,868 

+  £1,166,949 

1903         . 

5,217,237 

239,230 

+    4,978,007 

1904       .. 

4,983,590 

320,858 

+    4.662,732 

1905       . 

6,511,908 

163,875 

+    6,348,033 

1906       . 

3,642,464 

301,124 

+    3,341,340 

1907       . 

4,710,545 

626,777 

+    4,083.768 

1908       . 

5,730,243 

8,963 

+    5,721,280 

1909  (six 

months)       7,888,781 

2,991 

+    7,885,789 

The  increase  observed  from  one  year  to  the  other  in  the 
importation  of  bullion  is  in  direct  relation  to  the  increase 
of  exportations :  it  corresponds  to  the  consignments  of 
gold,  coming  especially  from  the  London  market,  in  order  to 
expunge  the  commercial  balance  in  favour  of  the  Argentine. 

In  the  light  of  these  observations  we  will  now  examine 
the  commercial  movement  in  itself,  while  noting  its  distribu- 
tion according  to  the  various  countries  which  exchange 
their  products  with  the  Argentine. 

We  will  then  give  a  list  of  the  principal  articles  entering 
into  the  composition  of  this  foreign  trade. 


Here  is  a 
for  the  first 
origin  and  in 

Country  of  Origin. 

Great  Britain     .., 

Germany 

United  States    ... 

France 

Italy 

Belgium 

Brazil 

Spain 

Uruguay 

Holland 

Paraguay 

Cuba 

Chili 

Bolivia 

Other  Countries 


Imports 

table  of  imports  for  the  years  1906-1908,  and 
six  months  of  1909,  classed  according  to  their 
order  of  importance : 

1907. 


1906. 

£18,965,987 

7,683,252 

7,894,979 

'  5,348,975 

4,824,727 

2,425,608 

1,328,205 

1,473,654 

366,648 

302,349 

261,794 

135,916 

105,643 

26,822 

2,829,544 


£19,587,148 

9,162,234 

7,768,455 

5,093,605 

4,800,648 

3,179,370 

1,569,871 

1,458,894 

494,551 

352,401 

282,867 

115,396 

110,965 

25,375 

3,170,354 


1908. 

£18,674,279 

7,569,417 

7,119,401 

5,295,385 

4,982,649 

2,550,674 

1,457,189 

1,723,622 

441,407 

407,606 

301,991 

136,137 

145,398 

31,212 

3,758,181 


1909. 

(Six  months). 

£9,416,405 

4,305,742 

3,704,917 

2,998,.346 

2,706,014 

1,309,920 

751,923 

859,013 

269,740 

212,714 

185,114 

59,607 

39,756 

13,443 

1,414,952 


Totals 


£53,994,104         £57,172,136         £54,594,547       £28,276,906 


FOREIGN  TRADE  219 

Great  Britain  is  always  at  the  head  of  the  list  of  imports, 
the  total  of  her  products  imported  by  the  Argentine  in  1908 
being  £18,674,279.  Among  these  products  one  of  the 
greatest  importance  is  coal,  of  which  2,338,949  tons  were 
imported  in  1907,  representing  a  value  of  £3,274,528.  Woven 
fabrics  of  all  kinds  attained  a  value  of  £3,038,694;  railroad 
material  £2,703,945,  and  sacking  for  making  up  into  sacks, 
£296,585. 

Germany  now  occupies  the  second  place.  The  imports 
from  Germany,  worth  £7,569,417  in  1908,  are  of  all  kinds, 
and  include  almost  every  kind  of  product  consumed  by 
the  Argentine.  On  account  of  her  various  industries,  metal- 
lurgical products  holds  the  first  place ;  then  come  woven 
fabrics  and  paper. 

The  United  States  send  principally  agricultural  material, 
petroleum,  and  pine  timber ;  the  imports  for  1908  were 
£7,119,400  in  value;  or  nearly  twice  the  value  of  the 
Argentine  exports  to  the  States.  This  situation  is  explained 
by  the  fact  that  both  countries  export  the  same  products — 
cereals  and  cattle,  etc. 

France  comes  fourth,  with  £5,295,385  worth  of  produce 
in  1908.  Her  products,  like  those  of  Germany,  are  very 
numerous  in  kind.  The  largest  imports  are  of  woven  fabrics, 
wines  and  spirits,  metallurgical  products,  pharmaceutical 
specialities,  and  perfumery.  Taking  the  item  of  wines 
and  spirits  alone,  the  Argentine  imports  £228,000  worth 
of  bitters  and  vermouth  and  £202,560  worth  of  wines  in  the 
wood. 

Italy  sent  £4,982,649  worth  of  imports  in  1908.  From 
Italy  the  Argentine  imports  the  largest  quantity  of  wines 
and  of  bitters,  valued  at  £922,938;  olive  oil  accounts  for 
£394,133,  rice  for  £295,667,  cheese  for  £181,949  (the  weight 
of  this  import  in  1907  being  2,274  tons) ;  in  short,  all  the 
articles  most  in  demand  among  the  Italian  emigrants. 
Woven  fabrics  attained  a  value  of  £927,857. 

Far  below  the  countries  already  named,  with  an  amount 
of  produce  less  than  half  that  imported  by  France,  comes 
Belgium  (£2,550,674  in  1908);  then  Brazil  (£1,457,189),  and 
Spain  (£1,723,622).  Belgium  sends  principally  metallurgical 
products ;  Spain  her  wines  and  oils  and  salt.   Brazil  sends  only 


220    THE  ARGENTINE  IN  THE  20th  CENTURY 

a  dozen  or  so  of  products  ;  the  most  important  being  coffee, 
tobacco,  and  especially  the  yerba  mate ;  a  herb  analogous  to 
tea,  and  used  as  a  beverage  in  the  country  districts.  Brazil 
and  Paraguay,  which  supply  it  to  the  Argentine,  sent 
£1,046,183  worth  of  the  herb  in  1908. 

The  table  given  below  shows  what  are  the  principal 
products  imported  by  the  Argentine  Republic,  and  show  the 
considerable  increase  which  has  taken  place  in  all  branches 
of  importation : — 


1906. 

1907. 

1908.      (^ 

1909. 
.St  six  months) 

Alimentary  products 

£3,532,509 

£4,183,187 

£4,709,819 

£2,226,053 

Beverages     

2,358,808 

2,526,748 

2,655,956 

1,155,965 

Textile  materials  and  fabrics 

10,826,008 

9,466,638 

9,982,267 

5,787,076 

Mineral   oils,  and    chemical 

I) 

and    phai'maceutical   pro- 

y 3,092,766 

3,254,653 

4,048,175 

2,174,871 

ducts 

i 

Woods,  furniture,  etc. 

1,122,444 

1,272,008 

1,262,573 

728,178 

Iron,   machines,     materials, 
implements,  utensils,  etc. 

1   6.988,461 

6,632,228 

6,015,097 

3,401,912 

Coal  and  other  mineral  pro- 
duce             

1  4,182,160 

4,126,910 

4,979,839 

2,229, 1'24 

Various  products* 

21,890,946 
.     53,994,102 

25,709,763 
57,172,135 

20,960,820 
54,594,546 

10,544,272 

Totals     .. 

28,507,351 

We  see  from  this  table  that  the  Argentine  relies  on 
foreign  imports  for  the  greater  number  of  metallic,  chemical, 
and  textile  products,  and  even  for  a  great  many  food-stuffs. 
An  essentially  agricultural  nation,  she  has  not  as  yet  de- 
veloped her  industrial  equipment,  nor  has  she  been  able 
to  undertake  the  transformation  of  the  raw  materials  at 
her  disposal  into  manufactured  products.  The  development 
of  her  agriculture  is  the  object  which  has  hitherto  absorbed 
all  the  initiative  and  all  the  capital  of  the  country. 

It  is  this  dependence  upon  foreign  countries  for  so 
many  articles  of  prime  necessity  that  makes  the  cost  of 
living  in  the  Argentine  so  high.  All  these  articles  have 
to  pay  customs   dues   varying  from    5   to   50   per  cent,  ad 

*  Under  this  heading  of  various  products  are  included  railway  material — 
rails,  chairs,  locomotives,  etc.— to  the  value  of  £4,672,486  in  1905,  £7,011 ,072 
in  1906,  £10,464,150  in  1907,  £6,015,097  in  1908,  and  £3,401,912  during  the 
first  six  months  of  1909.  Building  materials  amounted  in  value  to  £4,400,339 
in  1906,  £4,604,078  in  1907,  £4,236,485  in  1908,  and  £2,492,276  in  the  first 
half  of  1909. 


FOREIGN  TRADE 


221 


valorem;  dues  which  still  further  increase  the  exaggerated 
valuations  of  the  Customs  Administration. 

On  the  other  hand,  these  imports  are  by  no  means  so 
decentralised  as  the  exports ;  they  are  brought  as  near  as 
possible  to  the  centres  of  consumption,  so  that  they  shall 
not  be  forced  to  pay  fresh  freight  dues  in  the  interior.  The 
Customs  House  of  Buenos  Ayres  handles  84'9  per  cent,  of 
the  imports;  Rosario  92  per  cent.;  La  Plata  1-9  per  cent., 
and  Bahia  Blanca  -8  per  cent.  As  we  see  by  these  figures, 
the  Federal  Capital  almost  monopolises  the  imports,  whence 
arises  its  disproportionate  development  as  compared  with 
the  rest  of  the  country. 


Exports 

Here  is  the  table  of  the  exports  of  the  last  three  years, 
arranged  according  to  their  destination,  in  order  of  import- 
ance : — 


Destination. 

1906 

1907 

1908 

1909 

(l8t  Six  months) 

Great  Britain  * 

£8,644,807 

10,743,230 

15,644,944 

10,207,653 

France          

7,152,671 

7,-552,409 

5,782,750 

4,761,514 

Germany 

7,883,4139 

7,284,611 

0,950,399 

4,280,523 

Belgium 

5,124,279 

5,918,420 

7,155,637 

5,531,015 

Brazil            

2,378,203 

2,803,686 

3,019,115 

1,729,824 

United  States 

2,666,422 

2,188,087 

2,604,647 

2,411,460 

Italy 

1,381,225 

1,043,893 

1,581,571 

1,508,815 

Holland        

595,047 

834,818 

1,059,934 

623,634 

Spain 

514,515 

387,121 

519,920 

248,823 

Chili              

277,107 

370,133 

307,501 

297,018 

South  Africa 

791,600 

303,118 

172,088 

24,662 

Uruguay      

1,000,880 

275,328 

154,891 

112,329 

Cuba             

49,478 

144,890 

57,891 

42,046 

Bolivia          

65,719 

121,010 

118,745 

75,616 

Paraguay     

41,003 

36,530 

42,733 

17,166 

Other  destinatiouK  . . 

755,324 

598,740 

921,081 

792,241 

Shipments  to  order 

19,122,949 
58,450,766 

19,252,891 

27,085,119 
73,201,008 

17,710,457 

59,240,874 

50,354,688 

In  the  matter  of  exports  the  first  place  is  again  held  by 
England,  with  an  exportation  of  £15,664,944  in  1908  as 
against  £10,743,230  in  1907,  an  increase  of  £4,421,714. 

•  It  should  perhaps  be  explained  that  the  totals  are  correctly  converted  from 
the  Argentine  values,  but  are  not  the  exact  sums  of  the  columns  of  figures,  as 
these  latter  are  for  economy  of  space  printed  without  the  following  decimals 
that  result  from  conversion.  The  error  in  any  one  case  is  infinitesimal — from 
x^th  to  ro'uijth  of  1  per  cent. — [Tbans.J 
P 


222    THE  ARGENTINE  IN  THE  20th  CENTURY 

England  is  the  Argentine's  largest  client  in  the  matter  of 
agricultural  produce,  taking  ]  6  per  cent,  of  the  whole  amount 
exported.  In  1907  she  spent  £3,789,509  on  chilled  meats; 
£1,843,954  on  cereals — wheat,  maize,  and  linseed  ;  £1,212,471 
on  wools  ;  £193,  834  on  butter,  and  £379,810  on  sheepskins 
and  cowhides,  dried  and  salted,  Australia  also  imports  wheat 
and  maize  from  the  Argentine.* 

The  export  trade  to  England  is  still  capable  of  a  far  greater 
expansion,  if  England  will  only  determine  to  allow  cattle 
on  the  hoof  to  be  imported  once  more  ;  an  import  she  denied 
herself  some  years  ago,  on  account  of  anthrax,  and  one  which 
the  Argentine  is  eagerly  begging  her  to  resume,  under  proper 
sanitary  regulations. 

It  is  England  which  has  hitherto  preserved  the  closest 
balance  between  her  exports  to  and  imports  from  the  Argen- 
tine, and  no  other  country  has  so  far  been  able  to  oust  her 
from  her  dominant  position  in  the  Argentine  foreign  trade 
From  this  we  see  that  the  ties  which  unite  the  two  countries 
have  nothing  factitious  about  them ;  a  fact  which  is  still 
further  emphasised  by  the  statistics  of  English  capital  em- 
ployed in  the  Argentine. 

Germany  holds  the  second  place,  with  her  £6,950,399  oi 
imports  from  the  Argentine  (in  1908  :  £7,284,611  in  1907) 
After  England,  she  is  the  greatest  consumer  of  Argentin< 
wool ;  the  exports  of  this  product  in  1907  amounted  in  value 
to  £2,846,213.  Other  articles  absorbed  by  Germany  are  hides 
(to  the  value  of  £1,045,41 7),  and  cereal  products — wheat,  maize 
linseed,  and  bran — (to  the  value  of  £1,013,426).  The  Germai 
imports  from  the  Argentine  do  not,  however,  include  cattl( 
or  chilled  meats. 

France,  up  to  1876,  occupied  the  first  place  on  the  scale  o 
-  Argentine  exports.  To-day  her  imports  from  the  Argentiu' 
amount  to  ;£5,782,750  only  (1908),  or  nearly  £10,000,001; 
less  than  the  English  imports  (in  1907  they  amounted  t^ 
£7,552,409).  Her  purchases  in  the  Argentine  are  confined  t< 
a  very  few  products,  of  which  the  chief  est  is  wool,  the  valu 
of  the  export  in  1907  being  £4,908,510,  or  a  little  less  tha: 
half  the  entire  Argentine  production.  Then  come  hides,  t 
the  value  of  £1,508,764 ;  then  linseed,  maize,  and  wheat  t 

*  These  figures  are  for  1907  except  where  otherwise  stated. — [Trans.] 


* 


FOREIGN  TRADE  223 

th«  value  of  £309,956,  £322,473,  and  £271,488  respectively, 
the  whole  imports  from  the  Argentine  in  1907  being 
£7,552,419. 

The  French  system  of  Protection  has  so  far  stood  in 
the  way  of  the  trade  in  Argentine  cereals,  and  has  absolutely 
prohibited  the  entry  of  animals  or  chilled  meat.  The  interests 
of  the  French  agriculturalists  and  cattle-breeders  have 
hitherto  come  before  the  interest  of  the  consumer,  which  is 
to  obtain  the  products  necessary  to  life  in  the  cheapest 
market.  But  overtures  are  being  made,  by  the  common 
agreement  of  both  countries,  which  may  eventually  open  the 
French  market  to  Argentine  meats,  in  return  for  certain 
concessions  granted  to  France,  relative  to  the  exportation  of 
her  own  products — her  wine,  silks,  woven  fabrics,  etc. 

The  marked  and  progressive  decadence  of  the  Franco- 
Argentine  trade  ought  to  rivet  the  attention  of  French 
capitalists  and  statesmen.  Hitherto  numerous  ties  have  con- 
nected France  and  the  Argentine.  The  fundamental  code 
and  the  legislative  system  of  the  South  American  Republic 
have  been  impregnated  by  the  spirit  of  liberty,  equality  and 
fraternity  proclaimed  by  the  French  Revolution.  The  Argen- 
tine mind  is  fed  upon  French  thought,  science,  and  literature. 
It  is  now,  however,  to  be  seen  that  the  intellectual  influence 
of  France  is  losing  ground,  as  well  as  her  commercial  influ- 
ence, as  to-day  the  sense  of  national  fraternity  is  based  upon 
solidarity  of  interest. 

Now  the  decadence  of  French  trade  with  the  Argentine  is 
truly  alarming.  If  we  consult  the  publications  of  the  National 
Department  of  Statistics,  we  find,  for  instance,  that  in  the 
thirty-one  years  from  1876  to  1907  the  German  exports  to 
the  Argentine  have  increased  by  2450  per  cent, ;  the  Belgian, 
by  1002  per  cent. ;  those  from  the  United  States  by  1898  per 
cent.  ;  Italian  exports  by  907  per  cent. ;  English  by  992  per 
cent. ;  but  French  exports  have  increased  only  by  204  per 
cent. 

Compared  with  other  nations,  Fra*nce  has  least  been  able 
to  hold  her  own  in  the  matter  of  trade  with  the  Argentine. 
In  1876  the  importations  from  France  formed  23*2  per  cent, 
of  the  total  imports  ;  while  in  1908  they  formed  only  9-9  per 
cent,  of  the  totals,  making  a  proportional  diminution  of  18-3 


224    THE  ARGENTINE  IN  THE  20th  CENTURY 

per  cent,  in  thirty-two  years.  Our  imports  from  England, 
however,  which  in  1876  were  24*9  per  cent,  of  the  total,  had 
increased  to  34  percent,  by  1908 ;  representing  a  proportional 
increase  of  9  per  cent. 

We  are  thus  justified  in  concluding  that  all  our  efforts 
to  develop  the  current  of  Franco-Argentine  exchange  will 
contribute  powerfully  to  fortify  the  influence  of  France,  and 
the  sense  of  confraternity  between  the  two  Latin  nations. 

The  causes  of  the  decay  of  the  French  trade  have  been 
recapitulated  in  an  official  document  despatched  in  1904  by 
the  French  Chamber  of  Commerce  in  Buenos  Ayres  to  the 
Minister  of  Commerce, 

These  causes  may  be  summarised  as  follows : 

1.  The  exaggerated  duties  to  which  many  of  our  pro- 

ducts are  subjected  on  entering  the  Argentine. 

2.  The  competition  of  local  industry  with  the  imports 

of  certain  products. 

3.  The  dearness  of  labour  in  France,  and  the  conse- 

quent cost  of  manufacture,  which  in  many  cases 
no  longer  permits  us  to  struggle  against  our  com- 
petitors.* 

4.  The   imperfection   of    our   equipment   for   making 

certain  articles. 

5.  The  persistence  of  our  manufacturers  in  disregard- 

ing the  tastes  of  their  clientele. 

6.  The  insufficiency  of  the  credit  granted  by  French 

manufacturers  and  merchants  as  compared  with 
those  of  other  competing  countries. 

7.  The  frequent  lack  of  technical  knowledge  on  the 

part  of  foreign  commercial  travellers;  a  lack 
which  almost  always  prevents  them  from  benefit- 
ing as  they  should  from  direct  contact  with  their 
customers. 

8.  Finally,  in  the  matter  of  navigation,  the  expensive 

character  of  our  vessels,  and  the  resulting  dearness 
of  freight,  t  i 

*  The  case  of  France  is  especially  interesting,  because  her  tendency  ie  towardsij 
self-sufficiencj' — the  reverse  of  the  policy  of  nearly  all  other  countries. 

t  See  Rapport  d  M.  le  Ministre  du  Commerce  sur  les  causes  de  la  diminution 
du  commerce  J'ran<^aise  dans  la  Ripuhliqzte  Argentine,  1904. 


FOREIGN  TRADE  225 

Belgium  imports  some  £5,918,426  worth  of  produce  from 
the  Argentine  (£7,155,637  in  1908).  She  receives  much  the 
same  articles  as  Germany  :  £1,456,196  worth  of  wool,  and 
£2,285,174  worth  of  cereals,  of  which  £1,551,228  goes  for 
wheat.  We  find  a  new  item  figuring  in  the  Belgian  imports 
— extract  of  beef — to  the  value  of  £173,885;  this  extract  is 
made  by  Kemmerichs,  the  rivals  of  Liebigs,  who  manufacture 
their  extract  on  the  Uruguay. 

Of  late  years  the  Argentine  has  gained  a  new  client — 
South  Africa.  During  the  Boer  war  an  extensive  export 
trade  sprang  up,  in  live  animals,  chilled  meats,  and  cereals, 
and  this  trade  has  been  maintained.  The  value  of  the 
exports  to  South  Africa  in  1908  was  £172,088  (£303,418  in 
1907.) 

Brazil  also  imports  alimentary  products  from  the 
Argentine:  cereals,  and  especially  wheat  and  flour.  The  value 
of  the  exports  to  Brazil  in  1908  was  £3,019,115.  Between 
the  two  principal  countries  of  South  America — Brazil  and 
the  Argentine — economic  relations  are  promoted  by  con- 
venience ;  Brazil  furnishing  the  produce  of  its  prosperous 
and  varied  forms  of  agriculture — coffee,  yerba  mate,  tobacco, 
etc. — in  exchange  for  Argentine  cereals  and  cattle. 

In  North  America,  on  the  contrary,  the  Argentine  finds 
few  outlets  for  its  products,  as  the  two  countries  have 
almost  the  same  products.  The  exports  to  the  United  States 
were  £2,188,087  in  value  in  1907  ;  £2,604,647  in  1908 ;  con- 
sisting almost  entirely  of  hides,  wool,  and  extract  of 
quebracho  for  tanning;  while,  as  we  have  seen,  the 
exports  of  the  United  States  to  the  Argentine  reach  the 
value  of  £7,100,000. 

The  Argentine  Government  has  given  much  thought  to 
the  disadvantages  of  this  commercial  situation ;  it  has  sought 
means  to  remedy  it,  but  so  far  has  adopted  no  practical 
measures.  It  has  also  endeavoured  to  conclude  a  commercial 
agreement  with  Brazil,  but  without  success,  because  in 
South  American  states  questions  of  race-antagonism  often 
give  rise  to  the  gravest  problems.  This  fact  also  explains 
why  the  attempts  to  establish  a  commercial  treaty  have  so 
far  failed. 

In  his  last  message,  however,  the  President  of  the  Republic 


226    THE  ARGENTINE  IN  THE  20th  CENTURY 

admitted  that  negotiations  were  in  progress  with  a  view  to 
opening  up  new  markets  and  to  increase  the  mutual  trade  of 
the  Argentine  and  other  countries.  He  even  announced  that 
a  commercial  treaty  with  Chili  was  almost  completed.  On 
the  other  hand,  as  arbitration  treaties  have  just  been  con- 
cluded with  Brazil  and  the  United  States,  we  may  infer 
that  these  countries  are  not  systematically  opposed  to  any 
understanding  with  the  Argentine. 

Holding  positions  far  inferior  to  the  foregoing  countries 
are :  Italy,  which  in  1908  received  £1,581,571  worth  of 
Argentine  products,  principally  maize  and  hides  ;  Holland 
receiving  £1,059,394  worth  of  imports,  comprising  linseed 
and  cereals  (maize  and  wheat);  Uruguay,  importing  live-stock, 
meat,  sugar,  hides,  etc.,  to  the  value  of  £154,891  in  1907 
(£275,328  in  1908)  ;  Spain,  importing  maize,  hides,  and  fats 
to  the  value  of  £387,121  in  1907  (£519,920  in  1908);  and 
Chili,  importing  Argentine  produce  to  the  value  of  £370,133 
in  1907  (£307,501  in  1908),  consisting  entirely  of  cattle  and 
mules. 

Finally  we  must  mention  Austro- Hungary,  although 
that  country  has  very  little  commercial  contact  with  the 
Argentine.  The  imports  from  Austria  and  Hungary  amount 
to  some  £500,000  or  £600,000  (£578,932  in  1907,  £658,700 
in  1908),  and  the  Argentine  exports,  principally  wheat, 
amounted  to  a  value  of  £150,395  in  1907,  and  £214,227 
in  1908. 

One  department  of  the  foreign  trade  of  the  Argentine 
cannot  be  precisely  classified ;  namely,  that  of  the  products 
which  are  loaded  on  vessels  which  make  seawards,  and  those 
which,  coming  from  the  river  custom-houses,  are  transported 
to  Buenos  Ayres,  there  to  be  transhipped  for  foreign 
countries.  The  value  of  such  exports  was  £19,252,891,  in 
1907,  and  £27,085,119  in  1908.  This  sum  includes  the  value 
(£18,654,153  in  1907)  of  agricultural  products,  wheat  and 
maize,  despatched  to  order  but  without  exact  destination, 
whether  to  Saint  Vincent  in  the  Cape  Verde  Islands,  Laa 
Talmas  in  the  Canaries,  or  Falmouth  in  England. 

The  following  table  shows,  in  the  order  of  their  importance, 
the  products  exported   by   the  Argentine  during   the  three 


FOREIGN  TRADE  227 

years  1906-1908  and  the  first  six  months  of  1909,  so  that  we 
may  see  at  a  glance  what  branches  of  production  have  most 
rapidly  increased  : 

1906. 
Products  of  Stock-raising  £24,827,397 
Agriculture*   31,530,938 

Forestal  products 1,184,372 

Various    908,168 


1907. 

1908. 

(1st  six  months) 

£24,70.4,041 

£23,02.^601 

£16,213,533 

32,818,324 

48,335,432 

32,986,430 

1,068,471 

1,269,447 

704,772 

590,037 

272,497 

359,952 

Totals        ..    £58,450,875     £59,240,873     £72,921,067     £50,354,687 

We  see  that  agricultural  products  were  responsible  for 
the  enormous  increase  in  the  trade  statistics  of  1908.  They 
represented  66  per  cent,  of  the  total  exports,  and  had  increased 
nearly  50  per  cent,  in  one  year.  The  products  of  stock-raising 
have  not  increased ;  on  the  contrary,  there  is  a  falling  oflf  of 
more  than  £5,000,000  between  1905  and  1908,  the  value  in 
1905  being  £28,208,597. 

We  see  from  the  preceding  data  how  greatly  agriculture 
has  developed  in  the  Argentine  during  the  last  few  years. 
To  realise  precisely  how  great  this  development  has  been,  we 
need  only  recall  the  fact  that  the  exportation  of  corn  is  now 
10,000  times  greater  than  it  was  thirty  years  ago:  maize 
has  incrcixsed  by  800  per  cent. ;  fodder,  by  80  per  cent. ;  linseed, 
by  70,000  per  cent.;  flour  more  than  600  per  cent.t  These 
figures  show  how  rapid  the  growth  of  the  Argentine  has 
been,  and  what  progress  has  been  realised  in  spite  of  temporary 
crises. 

If  we  now  consider  the  progress  of  external  trade,  not 
from  year  to  year  and  in  detail  but  as  a  whole,  and  over 
a  large  period,  we  can  no  longer  doubt  that  this  trade  is 
destined  to  accomplish  still  greater  development.  Importa- 
tion too,  the  field  for  which  is  somewhat  restricted,  may  also 
realise  a  greater  progress  as  the  population  increases.  Again, 
once  the  Argentine  develops  her  industries  with  greater 
energy,  it  is  only  natural  that  larger  quantities  of  raw 
material  will  be  imported,  to  be  transformed  into  manufactured 
articles. 

*  The  agricultural  exports  for  1906   were  sensibly  lower  than    those    of 
1905,  on  account  of  a  decrease  of  £3,864,392  in  the  exports  of  wheat, 
t  Latzina,  work  already  cited,  p.  511 . 


228    THE  ARGENTINE  IN  THE  20th  CENTURY 

As  for  the  increase  of  exports,  we  have  only  to  turn  to 
the  data  already  given  concerning  the  annual  increase  in  the 
area  of  sown  land,  and  the  importance  of  those  lands  which 
have  yet  to  reach  their  true  value,  but  will  do  so  as  soon 
as  the  stream  of  immigration  supplies  them  with  settlers  and 
colonists. 

Moreover,  the  creation  of  a  network  of  economical  light 
railways,  and  the  opening  of  new  ports  on  the  great  rivers, 
will  give  the  export  trade  new  facilities,  which  will  naturally 
result  in  an  increased  trade. 

In  the  first  edition  of  this  book  we  remarked  that  there 
was  still  an  unknown  factor  in  the  future  of  the  foreign 
trade  of  the  Argentine.  Now  there  is,  in  the  Presidential 
Message,  an  allusion  to  the  eventual  termination  of  the 
commercial  treaties  with  the  principal  nations,  with  the 
intention  of  suppressing  the  "  most  favoured  nation  "  clause, 
and  of  opening  up  direct  negotiations. 

Very  fortunately  this  measure  has  had  no  practical 
consequences,  for  the  revision  of  treaties  is  a  delicate  piece 
of  work  for  a  nation  essentially  tributary  to  the  foreigner, 
if  one  wishes  to  avoid  the  risk  of  provoking  reactions  which 
might  compromise  the  results  already  obtained. 

This  "  most  favoured  nation  "  clause,  which  the  Republic 
inserts  in  all  its  treaties,  has,  for  the  rest,  by  no  means 
impeded  the  enormous  expansion  of  the  Argentine  export 
trade  which  we  have  already  noted.  We  must  conclude  that 
the  termination  of  commercial  treaties,  with  the  object  of 
effacing  this  clause,  has  become,  even  in  the  case  of 
distinguished  statesmen,  a  continual  obsession,  although  it 
is  justified  by  no  decisive  argument,  and  might  well  expose 
the  country  to  dangerous  vicissitudes.* 

On  certain  points,  however,  the  customs  laws  of  the 
Republic  might  well  be  revised  in  such  a  way  as  to  stimulate 
foreign  trade. 

Thus  with  regard  to  France  oflScial  negotiations  have 
already  been  opened,  with  the  object  of  affording  the 
Argentine  certain  facilities  in  the  introduction  of  her  chilled 

♦  One  may  with  proflt  consult  a  notable  report  on  La  clause  de  la  nation  la  plus 
favorisie.Sy  preBented  to  the  Minister  of  Agriculture  by  the  Divisional  Chief, 
Richard  Pillado. 


FOREIGN  TRADE  229 

meats ;  while  in  return  French  wines  and  woven  fabrics,  etc., 
were  to  be  given  a  preferential  treatment.  Just  as  the  basis 
of  this  arrangement  appears,  we  have  as  yet  no  reason  to 
suppose  that  it  will  be  ratified  by  the  two  nations  ci)ncerned, 
or  that  it  will  soon  be  put  into  execution. 

Taking  a  more  general  point  of  view,  we  are  obliged  to 
admit  that  if  French  commerce,  and  especially  French 
industry,  have  not  won  the  place  which  should  be  theirs  in 
the  Argentine  Republic,  when  we  consider  the  magnitude  of 
Argentine  exportation  to  France,  it  is  because  French  men 
of  business  and  manufacturers  have  started  from  a  false 
principle,  from  whose  consequences  they  and  the  Argentine 
are  still  suffering.  Instead  of  following  up  the  rapid  evolu- 
tion of  the  Argentine,  the  French  have  persisted  in  regarding 
it,  from  afar  off,  as  a  nation  scarcely  yet  open  to  civilisation 
and  progress.  They  used  to  seek  to  get  rid  of  remainders, 
old-fashioned  articles,  and  out-of-date  equipments  in  the 
Argentine,  as  they  do  to-day  in  China  and  Africa.  Such 
railways  as  are  built  with  French  material  are  an  example 
of  this  practice;  their  installation  left  much  to  be  desired, 
and  it  is  only  lately  that  they  have  made  some  efforts  to 
support  comparison  with  other  lines. 

The  English,  Germans,  and  Americans  of  the  States  were 
better  advised.  Having  studied  with  greater  care  the 
country  and  its  tendencies,  they  were  able  to  initiate  it  into 
the  paths  of  material  progress.  Those  railways  which  were 
built  by  English  contractors  or  companies  are  models  of 
perfect  adaptation  to  the  needs  of  the  country.  The  equip- 
ment of  the  tramways,  furnished  by  the  United  States,  may 
be  compared  with  that  of  the  principal  capitals  of  Europe. 
In  the  matter  of  electric  lighting  the  great  German  companies 
have  installed  the  best  German  plant. 

The  same  observations  may  be  made  of  a  large  number 
of  other  products  imported  from  abroad.  There  is  nothing 
better  in  the  United  States  in  the  matter  of  agricultural 
equipment  than  that  possessed  by  the  Argentine  ;  as  for 
stock-raising,  we  have  only  to  remember  that  it  is  to  South 
America  that  England  sends  her  best  bulls,  rams,  and 
stallions. 

But  from  these  remarks  it  must  not  be  concluded  that 


230    THE  ARGENTINE  IN  THE  20th  CENTURY 

the  Argentine  has  bought  too  dearly  the  glory  of  an  equip- 
ment which  is  modern  as   compared  with  that  of  the   old 
European  nations.     Of   late  years  it  is  rather  the   reverse 
that  has  been  true.     The  leading  industrial  countries,  being 
anxious  to  sell  off  their  stock  on  account  of  an  almost  general 
over-production,  have  been  propelled  towards  the  markets 
of  exportation  in  order  to  get  rid  of  their  surplus.     From 
this  has  resulted  a  competition  from  which  the  Argentine 
has  in  many  cases  profited,  by  obtaining  industrial  products 
under  particularly  advantageous  conditions.     Such  has  been 
the  case  in  the  matter,  for  example,  of   rails ;   the  German 
trade  offered  them  at  £4,  16s.  per  ton,  at  a  time  when  the 
European  prices  were  considerably  higher;  Germany,  how- 
ever, was  supplanted  by  the  factories  of  the  United  States, 
which  supplied  them  at  £2,  8s.  per  ton.     This  is  an  applica- 
tion of  the  new  economic  process  known  as  dmnping,  which 
consists  in  developing  production  as  far  as  possible,  in  order 
to  lower  the  net  cost  of  production,  and  then  to  sell  at  this 
net  cost  price,  in  foreign  markets,  all  that  the  producing 
country  fails  to  absorb. 

All  the  nations  we  have  cited  are  the  actual  consumers  of 
Argentine  products  ;  but  it  is  to  be  hoped  that  yet  other 
markets  will  be  opened,  attracted  by  the  abundance  and  the 
quality  of  these  products. 

Among  these  countries  disposed  to  trade  with  the 
Argentine  we  must  mention  the  Japanese  Empire,  which 
is  endeavouring  to  develop  its  trade  upon  a  reciprocal  basis, 
and  has  sent  a  commission  of  delegates  to  Buenos  Ayres, 
who  were  instructed  to  obtain  complete  and  practical  data 
as  to  the  possibility  of  establishiug  a  mutual  trade  with  the 
young  South  American  nation. 

The  Japanese  commissioners  have  accomplished  their 
trade  with  the  earnest  application  characteristic  of  their 
countrymen,  and  after  studying  the  question  for  more  than 
a  year  they  have  arrived  at  the  conclusion  that  many 
Argentine  products,  and  among  them  wools,  hides,  and  flour, 
might  find  an  extensive  outlet  in  Japan ;  but  only  if  ! 
imported  free  from  the  expenses  imposed  by  the  European 
middleman. 

Pursuing  their  investigations,  the  Japanese  Commissioners 


FOREIGN  TRADE  231 

discovered  that  the  great  difficulty  in  the  way  of  a  direct 
trade  between  the  Argentine  and  Japan  consists  in  the  fact 
that  there  is  no  direct  line  of  steamers  ;  but  this  obstacle 
might  be  overcome  by  an  arrangement  with  the  Toyo- 
Yusen-Kaisha  Company,  which  would  establish  a  direct 
service  to  Buenos  Ayres  via  Cape  Town  in  forty-five  days ; 
at  present  the  voyage  takes  seventy  days.  This  arrange- 
ment would  lead  to  a  reduction  of  75  per  cent,  on  the 
freights. 

Flattering,  however,  as  the  prospects  of  this  new  market 
may  seem,  there  is  one  item  in  the  plan  of  the  Japanese 
Government  which  gives  rise  to  considerable  reflection  on 
the  part  of  our  Argentine  statesmen :  namely,  the  proposal 
to  introduce  Japanese  agricultural  immigrants  into  the 
Argentine ;  that  is,  immigrants  whose  presence  would  in 
many  ways  be  inconvenient ;  against  whoso  presence  the 
United  States  and  other  countries  have  reacted,  and  whose 
very  presence  in  the  Argentine  would  be  contrary  to  the 
sense  of  the  Argentine  Constitution,  which  imposes  upon 
Congress  the  duty  of  encouraging  European  immigration. 

In  concluding  this  study  of  the  foreign  trade  of  the 
Argentine  Republic  and  its  remarkable  development,  we 
cannot  do  better  than  quote  the  enthusiastic  words  by 
which  an  Argentine  statesman  terminated  a  study  of  the 
same  question,  thus  summarising  all  the  various  elements 
which  concur  in  the  development  of  the  commercial  activity 
of  the  nation : 

"  Despite  the  scanty  population,  and  the  small  proportion 
of  our  agricultural  resources  which  has  as  yet  been 
exploited,  the  production  of  the  Argentine  is  considerable. 
The  herds  grazing  in  our  pastures  show  the  state  of  progress 
which  stock-raising  has  attained ;  the  harvests  which  cover 
the  plains  of  Santa  Fe  and  Buenos  Ayres  have  made  the 
name  of  the  Argentine  Republic  known  on  the  markets  of 
Europe  as  that  of  a  flourishing  agricultural  country ;  sugar, 
tiie  product  of  the  cane-flelds  of  Tucuman,  has  enriched  that 
Province  and  the  national  industry,  and  very  shortly  the  vines 
grown  in  the  valleys  of  the  old  Province  of  Cuyo  will  achieve 
a  yet  wider  development,  and  will  give  still  more  abundant 
vintages. 


232    THE  ARGENTINE  IN  THE  20th  CENTURY 

"  The  smoke-stacks  of  manufacturers  overlook  many  of  the 
cities  of  the  Republic,  and  certain  native  products  are  now 
being  transformed,  as  raw  material,  into  finished  articles 
by  the  nation's  labour.  Industries  based  upon  the  vitality 
of  our  production,  and  supported  by  the  public  powers  solely 
in  a  rational  and  equitable  degree,  are  developing  them- 
selves without  being  forced  to  resort  to  the  exaggerated  and 
always  mistaken  assistance  of  an  excessive  protectionism. 
In  short,  our  foreign  trade,  upon  whose  promising  results  we 
have  already  commented,  will  in  its  turn  fortify  the  economic 
organism,  which  is  the  basis  of  the  welfare  and  the  power  of 
nations."  * 

The  Commercial  Balance. 

In  a  country  like  the  Argentine,  which  has  no  accumulated 
reserves,  and  has  not  become  the  creditor  of  foreign  countries 
by  investing  its  capital  abroad,  a  favourable  commercial 
balance  (that  is  to  say,  the  realisation  of  an  excess  of  exports 
over  imports)  is  a  matter  of  considerable  importance.  Now 
this  excess  was  £18,600,000  in  1908  ;  a  record,  if  we  omit  1905, 
which  proves  clearly  that  the  Argentine  has  entered  upon 
a  period  of  exceptional  prosperity  from  the  economic  point 
of  view. 

To  understand  the  full  significance  of  this  commercial 
balance,  we  must  bear  in  mind  the  financial  situation  of  the 
Argentine,  which  has  a  foreign  debt  of  £74,200,000,  demand- 
ing a  yearly  interest  of  £3,907,200,  payable,  of  course,  in 
gold.  In  order,  then,  that  the  country  may  be  able  to  keep 
its  engagements,  the  total  value  of  its  exports  must  cover 
the  amount  due  on  the  year's  imports  and  must  also  cover 
the  interest  to  be  paid  on  the  foreign  debt,  the  dividends 
earned  by  the  railway  companies,  etc.,  and  the  expenses  of 
maritime  transport. 

All  that  we  have  considered  up  to  the  present  shows  that 
the  productive  capacity  of  the  Argentine  is  limited  to  the 
results  of  agriculture  and  stock-raising.  With  the  exception 
of  these  two  elements  we  may  say  that  the  country  produces 
nothing,   transforms   nothing.      Industry   is    as   yet   in   its 

*  See  Memoria  del  Departemento  de  Hacienda,  by  T.  M.  Rosa,  1899,  vol.  i., 
p.  170. 


FOREIGN  TRADE  233 

infancy ;  internal  trade  is  undeveloped ;  the  mercantile 
marine  is  of  no  importance.  For  this  reason  the  Argentine 
must  perforce  employ  the  results  of  its  agricultural  exporta- 
tion in  procuring  what  it  lacks — objects  of  prime  necessity, 
or  raw  materials  of  all  kinds.  We  can  thus  understand  what 
an  influence  a  change  for  the  worse  in  the  commercial  balance 
may  exercise  on  the  destinies  of  the  country.  If  there  is  a 
bad  harvest  the  deficit  must  somehow  be  made  up  ;  and  as 
Argentina  has  not  as  yet  saved  enough  capital  to  allow 
her  to  live  on  her  own  reserve  funds,  it  is  at  such  times  that 
a  loan  becomes  necessary. 

Thus  each  bad  harvest  helps  to  increase  the  foreign  debt, 
to  say  nothing  of  the  financial  disturbances  which  it  irnxy 
create. 

It  may  be  asked  why,  after  a  certain  number  of  years 
of  abundant  harvests,  the  Argentine  has  not  as  yet  established 
this  financial  reserve,  which  would  serve  to  lessen  the  blow 
of  a  bad  agricultural  year,  and  compensate  the  deficient 
exportation  of  a  year  of  lean  cattle.  The  answer  will  be 
found  in  the  figures  which  we  print  further  on,  relating  to 
the  amount  of  foreign  capital  invested  in  the  Argentine ;  in 
Government  bonds,  shares  in  railway  companies,  or  other 
undertakings,  public  or  private.  According  to  our  estimate, 
this  sum  amounts  approximately  to  £317,200,000,  representing 
an  annual  drain  of  £18,400,000  in  the  shape  of  interest, 
dividends,  or  redemption  money.  This  is  assuredly  the 
outlet  by  which  much  of  the  country's  savings  escape,  for 
we  may  truly  say  that  the  Argentine,  which  is  in  a  sense  so 
much  international  territory,  works  more  for  other  countries 
than  for  itself. 

Again,  as  we  shall  see,  this  exodus  of  capital  takes  place 
also  by  other  means ;  notably  by  the  emigration  of  those 
natives  or  foreigners  who  leave  the  Argentine  to  settle  in 
Europe.  It  is  not  rare,  among  Argentine  families,  to  see 
certain  members,  having  made  their  fortunes,  emigrate  to 
enjoy  their  incomes  under  other  skies.  This  applies  yet 
more  frequently  to  foreigners.  The  Italian,  for  example 
(and  more  Italians  come  to  the  Argentine  than  natives  of 
any  other  country),  the  Italian  is  given  to  transforming  his 
savings  into  money  of  his  own  country ;  either  with  a  view 


234    THE  ARGENTINE  IN  THE  20th  CENTURY 

to  returning,  or  because  he  cannot  on  the  spot  find  security 
or  facility  for  the  accumulation  of  personal  property. 

So  at  the  present  time  there  are  two  distinct  movements 
of  capital;  two  movements  of  contrary  direction  and  absolutely 
distinct.  Firstly,  money  flows  into  the  country  in  payment 
of  exports ;  secondly,  money  flows  out  of  the  country  in  pay- 
ment of  imports ;  and  also  in  consideration  of  foreign  capital 
invested  in  the  Argentine.  From  these  two  movements,  in 
times  of  prosperity,  a  third  movement  arises ;  a  movement 
which  brings  foreign  capital  into  the  Argentine,  where  it 
finds  employment  in  important  undertakings,  due  to 
Governmental  or  to  private  initiative.  But  although  this 
influx  of  capital  may  mean  further  national  progress,  it  does 
not  permanently  aflfect  the  commercial  balance  of  the  country, 
as  the  revenue  deriving  from  it  benefits  the  foreigner. 

Whatever  point  of  view  we  assume,  we  must  always 
arrive  at  the  same  conclusion  ;  that  the  whole  economic  life 
of  the  Republic  depends  upon  its  agricultural  exports  ;  its 
commercial  balance  has  no  other  counter-weight  to  help  it 
to  overcome  the  burden  of  debts  contracted  abroad  by  the 
importation  of  merchandise  or  of  capital.  For  ten  years  now 
the  sense  of  this  commercial  balance  has  been  constantly  in 
favour  of  the  exports,  and  there  has  even  been  a  remarkable 
progress,  scarcely  interrupted  at  critical  moments.  But  ten 
years  is  only  a  brief  period  in  the  life  of  a  people ;  and  how- 
ever favourable  the  future  outlook  may  appear,  we  must 
always  be  prepared  for  a  possible  deficit,  for  a  minus  balance, 
as  the  result  of  a  bad  harvest  or  some  grave  political  crisis. 
These,  in  a  country  without  reserves  of  capital,  are  contin- 
gencies of  which  we  must  never  lose  sight,  and  which  force 
us  to  express  our  appreciation  of  the  financial  or  economic 
system  of  the  Argentine  with  a  certain  reserve. 


r» 


CHAPTER  II 

THE   GREAT  ARGENTINE   INDUSTRIES 

/The  principal  industries  of  the  country  are  related  to  agriculture  and  oattla- 

^       breeding. 

Sdqar-planting,  Boiling,  etc. — Capital  engaged — Tucuman  the  chief  centre — 

Production  and  exportation — The  sugar  crisis — The  Rosario  Refinery. 
Flour  Export  Trade — Capital  invested — Equipment,  steam  flour-mills,  grain- 
elevators — Production  and  exportation. 
Rkfrigeration — At  present  the  chief    industry  of  the  country — Number  of 

establishments — Table  of  exports  of  frozen  and   chilled   meats — Capital 

invested — Development  of  the  industry. 
Dairt  Industries — The  large  establishments   devoting   themselves   to    thesa 

industries— Butter  ;  cheese — Exports  of  butter;  the  development  of  which 

the  dairy  industries  are  capable. 
BRi^WBRies — Chief    establishments  — 'Production    and    consumption    of    boer 

during  the  years  1902-1907 — Suppression  of  imports  of  foreign  beer. 
vSpirits — Decreased  production  of  spirits. 
Looms,  Tanneries — Weaving  and  tanning  are  industries  -which  at  present  exist 

in  the  Argentine  only  in  a  rudimentary  condition,  despite  the  conditions 

which  are  favourable  to  their  development. 
Quebracho     Wood — The     centre     of     production — Applications — Companies 

engaged  in  the  industry — Their  results — Value  of  the  products  and  the 

large  profits  to  be  expected. 
Timber  Trade — Varieties  of  timber  and  hard  woods. 
Fisheries — First  results  of  this  industry. 

THE  industry  of  the  Argentine  Republic  is  more  or  less 
-mdependent  upon  its  agriculture  and  stock-raising, 
which  contribute  the  raw  materials  for  the  manufacture  of 
various  alimentary  products.  Among  those  industries  which 
are  thus  dependent  on  the  produce  of  the  soil  we  must 
mention,  as  the  more  important,  sugar-boiling,  flour-milling, 
the  chilled-meat  industry,  the  making  of  butter,  cheese,  and 
oil,  brewing,  and  distilling. 

Besides  these  industries,  the  majority  of  which  are 
flourishing  and  suffice  for  the  needs  of  the  country,  we 
must  mention  others  which  are  still  in  a  rudimentary  state, 
but  which  seem  to  have  an  assured  future,  on  account  of  the 
abundance  of  raw  material ;  namely,  the  weaving  of  woollen 
and  cotton  fabrics,  and  the  preparation  of  leathers.  We 
235 


236    THE  ARGENTINE  IN  THE  20th  CENTURY 

shall  therefore  have  occasion  to  remark  upon  the  conditions 
of  their  development. 

Sugar  Factories. — The  sugar  industry  has  fairly  remote 
antecedents  in  the  Argentine.  Dr  Latzina  traces  it  back  to 
the  Jesuits ;  the  inventory  of  their  goods,  drawn  up  at  the 
time  of  their  expulsion  in  1767,  proving  the  existence  of  a 
field  of  cane  and  a  sugar-mill. 

Despite  its  respectable  antiquity,  the  sugar  industry  only 
began  to  be  of  significance  towards  the  middle  of  the 
nineteenth  century,  at  which  time  it  was  established  in 
Tucuman,  whose  soil  appeared  to  be  favourable  to  the  culti- 
vation of  the  cane.  Since  then  it  has  developed  gradually, 
but  it  is  only  during  the  last  ten  years  that  it  has  spread  to 
any  considerable  extent. 

We  have  given  the  details  of  this  development,  together 
with  figures,  in  the  chapter  dealing  with  the  industrial 
branches  of  agriculture,  in  which  we  spoke  of  the  laws 
affecting  this  industry. 

To-day  the  number  of  sugar-mills  or  factories  is  thirty-one; 
they  belong  to  limited  companies  or  to  private  persons,  and 
represent  a  total  capital  of  £4,224,000,  to  which  sum  we  must 
add  another  of  £2,640,000  as  the  value  of  some  160,200  acres 
planted  with  cane,  at  the  rate  of  £16  to  £17  per  acre,  and 
£369,600  as  the  value  of  the  Rosario  Refinery ;  which  giVes 
us  a  total  of  £7,233,600  invested  in  this  industry.  The  largest 
undertakings  used  to  be  in  the  hands  of  Seiior  Tornquist 
and  M.  Hilairet,  now  both  deceased,  to  whom  the  country  is 
indebted  for  the  great  progress  effected  in  this  industry. 

To  sum  up  the  position  of  this  industry,  we  must  recall 
the  fact  that  the  area  of  Argentine  soil  planted  with  sugar- 
cane at  the  end  of  1907  was  172,900  acres,  which  yielded  an 
average  crop  of  12 '4  tons  of  cane  per  acre,  and  produced 
about  130,000  tons  of  sugar. 

The  sugar  industry  has  been  developed  in  this  country, 
as  in  so  many  others,  by  the  system  of  export  bounties  or 
premiums,  which  has  since  been  suppressed.  Twenty  years 
ago  the  Argentine  had  to  import  nearly  all  her  sugar  from 
Europe — more  than  100,000  tons  per  annum — while  to-day 
she  produces  far  more  than  she  can  consume,  and  has  to 
export  the  surplus  of  her  production. 


THE  GREAT  ARGENTINE  INDUSTRIES       237 

Although  the  progress  accomplished  was  so  rapid,  it 
was  not  effected  without  certain  misunderstandings,  caused 
by  excessive  production.  At  the  end  of  the  sugar  crisis 
of  1896-7,  which  occasioned  the  closing  of  a  number  of 
factories,  attempts  were  made  to  regulate  the  industry,  at  the 
instance  of  the  leading  makers.  To-day  there  is  a  syndicate 
which  regulates  production  within  the  limits  of  exportation 
and  production, and  serves  as  a  sales  agency  for  all  the  factories. 

The  sugar  industry  of  Tucuman  has  the  advantage  as 
part  of  its  equipment  the  Rosario  refinery,  which  receives  the 
raw  sugar  of  Tucuman  and  subjects  it  to  the  various  processes 
of  crystallisation  and  bleaching.  Its  output  during  the  agri- 
cultural year  1906-7  was  107,621,800  lb.  of  refined  sugar; 
during  the  year  1907-1908  it  was  120,552,220  lb. 

i^/oif7'-m'?7^'i'n(jr.— Flour-milling  has  had  much  the  same 
history  as  the  sugar  industry.  Although  the  industry  was 
established  in  the  Argentine  as  early  as  the  sixteenth  century, 
it  has  only  been  properly  developed  during  the  last  twenty 
years.  Before  this  period  the  Argentine  was  supplied  partly 
from  Chili,  as  its  power  of  production  had  not  kept  pace 
with  its  population.  To-day  the  situation  has  been 
completely  transformed,  since  the  enormous  development  of 
agriculture ;  not  only  does  the  flour  produced  suffice  for  the 
country,  but  since  1878  an  export  trade  has  sprung  up, 
amounting  to  39,000  tons  in  1902,  72,000  in  1903,  107,000  in 
1904,  144,700  in  1905,  129,000  in  1906,  and  127,000  in  1907. 
Brazil  is  the  Argentine's  best  customer  for  flour,  having 
imported  84,000  tons  in  1904, 103,000  in  1905, 114,000  in  1906, 
and  118,300  in  1907. 

Great  Britain  was  the  second-best  customer  for  flour, 
having  imported  14,800  tons  in  1904,  24,400  in  1905,  5400  in 
1906,  and  1200  in  1907  ;  to-day  the  exportation  is  negligible. 

It  is  estimated  that  there  are  600  or  700  flour-mills  in 
the  Argentine,  representing  a  capital  of  from  £2,200,000  to 
£2,640,000.  Buenos  Ayrcs  has  two,  which  have  been  lately 
installed  on  American  models.  They  are  situated  on  land 
belonging  to  Madero  Harbour,  and  comprise  a  fine  and  power- 
ful equipment,  with  grain-elevators,  silos,  and  granaries.  One 
is  the  property  of  the  Belgian  Steam  Flour-mills  Company, 
and  has  a  capacity  of  from  12,000  to  14,000  tons.     The  other, 


238    THE  ARGENTINE  IN  THE  20th  CENTURY 

with  a  capacity  of  80,000  tons,  was  built  by  the  efforts  of 
two  great  railway  companies,  the  Buenos-Ayres  Rosario  and 
the  Central  Argentine.  We  have  seen  that  no  less  important 
installations  are  shortly  to  be  built  at  Rosario,  by  the  French 
company  which  holds  the  harbour  concession. 

The  Refrigerating  Industry. — Among  all  the  Argentine 
industries  the  most  important  is  that  of  chilling  or  freezing 
meat  and  other  foodstuffs.  It  is  gradually  replacing,  in  the 
export  markets,  the  salt  meat  or  saladeros  industry,  which 
formerly  was  the  only  industry  in  the  country  dependent 
upon  stock-raising.  The  latter  industry  is  carried  on  princi- 
pally in  Buenos  Ayres,  Santa  Fe,  Entre  Rios,  and  Corrientes. 
The  principal  refrigerating  establishments  are  the 
following : — 

The  Sansinena  Frozen    Meat   Co.,    with    a    capital    of 

£600,000,  and  the  warehouses  known  as  La  Negra,  at  Buenos 

Ayres  and  Bahia  Blanca,  in  the  quarter  known  as  Cuatreros. 

The  River  Plate  Fresh  Meat  Co.,  with  a  capital  of  £453,600, 

whose  warehouses  are  in  the  Province  of  Buenos  Ayres. 

The  Palmas  Produce  Co.,  which  is  a  component  part  of  j 
James  Nelson  &  Co.,  and  has  a  capital  of  £500,000,  exploits  ' 
the  district  of  Campana. 

La  Blanca,  with  a  capital  of  £300,000,  established  at 
Buenos  Ayres. 

The  Plata  Cold  Storage  Co.,  with  a  capital  of  £403,805, 
situated  at  La  Plata. 

Recently  another  refrigerating  establishment  has  been 
inaugurated  at  Zarate,  the  property  of  the  Smithfield  and 
Argentine  Meat  Co.,  with  a  mechanical  equipment  allowing 
150  bullocks  and  600  sheep  to  be  killed  per  diem.  Its 
capital  is  £200,000. 

To  this  list  we  may  add  the  Kemmerich  Products  Co., 
which  manufactures  extracts  of  beef.  Its  capital  is  £480,000, 
and  it  is  established  at  Santa  Elena,  in  the  Province  of  Entre 
Rios.  This  company  owns  2700  square  miles  of  land,  340,000 
cattle,  20,000  horses,  and  50,000  sheep. 

The  exports  of  the  refrigerating  establishmeuts  for  the 
last  seven  years  are  given  in  the  following  table,  which  shows 
the  enormous  increase  in  the  export  of  quarters  of  beef, 
during  the  last  few  years. 


THE  GREAT  ARGENTINE  INDUSTRIES       239 


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200,254 
259,073 
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261,335 
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163,624 
32,670 
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84,476 
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300,605 
249,071 
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191,294 
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240    THE  ARGENTINE  IN  THE  20th  CENTURY 

The  capital  invested  in  the  refrigerating  industry,  includ- 
ing both  share  capital  and  loans,  is  estimated  at  £4,449,825. 
The  profits  obtainable  may  be  judged  by  the  dividends  paid 
by  the  most  important  of  the  refrigerating  companies :  the 
Sansinena  Frozen  Meats  Co.,  in  1902,  paid  50  per  cent,  out  of 
the  exceptional  profits  realised  by  the  sale  of  cattle  in  South 
Africa  during  the  Boer  war.  Since  then  the  dividends  of 
this  company  have  fallen  to  10  per  cent. 

Another  cause  of  the  development  of  this  industry  is  the 
closing  of  English  ports  against  cargoes  of  live  cattle,  for  fear 
of  anthrax.  It  is  by  the  help  of  this  prohibition  that  the 
refrigerating  companies  have  conquered  the  English  market, 
which  to-day  takes  up  the  greater  part  of  our  frozen  meat, 
as  before  it  took  our  cattle.  Steps  have  of  late  been  taken 
with  a  view  to  re-opening  the  ports  under  a  pledge  of  sanitary 
measures ;  but  nothing  decisive  has  been  done,  on  account  of 
the  protests  of  English  cattle-breeders,  and  also  of  the 
refrigerating  companies,  most  of  which  have  been  created 
by  English  capital. 

The  Dairy  Industry. — Among  the  industries  connected 
with  cattle-breeding  there  is  one  which,  without  having  the 
same  importance  as  the  industry  dealt  with  above,  has  yet 
a  certain  margin  of  development.  This  is  the  dairy  industry, 
with  its  derivatives,  butter  and  cheese-making. 

The  Argentine  breeders  having  imported  excellent 
Durham  or  Dutch  milch-cows,  the  dairy  produce  is  of  the 
finest  quality. 

Large  establishments,  of  which  one.  La  Martona,  belongs 
to  a  private  company,  have  been  installed  for  the  purpose 
of  supplying  the  city  of  Buenos  Ayres  with  milk.  It  is 
estimated  that  the  daily  sale  at  the  counters  of  La  Martona 
amounts  to  10,000  glasses ;  the  sales  of  La  Marina  amount 
to  6000,  and  of  La  Oranja  Blanca  to  10,000  glasses.  All 
these  approximate  figures  refer  to  the  summer  only,  and  the 
sales  across  the  counter  by  the  litre,  for  family  consumption, 
and  the  house  to  house  distribution,  are  not  included  in  these* 
figures.  Besides  the  above  establishments  there  are  many 
cow-keepers  in  the  city,  as  well  as  dairymen  who  receive 
their  milk  by  rail. 

As  for  butter  and  cheese,  it  was  estimated  at  the  time  of 


THE  GREAT  ARGENTINE  INDUSTRIES       241 

the  census  of  1895  that  there  were  357  establishments  devoted 
to  this  industry.  In  the  matter  of  butter  the  Argentine 
does  more  than  suffice  to  itself — though  ten  years  ago  this  was 
not  the  case — but  to-day  it  exports  considerable  quantities 
to  England,  Brazil,  and  South  Africa. 

To  give  the  reader  some  idea  of  the  dimensions  which 
the  butter-making  industry  may  attain  in  the  future,  we 
need  only  cite  the  following  data  : — 

According  to  the  national  census  of  1895  there  were 
22,000,000  cattle  in  the  Argentine  Republic,  of  which  only 
1,200,000  figured  as  milch  cows  ;  the  value  of  the  latter 
being  not  less  than  £14,000,000.  Butter-making  and  cheese- 
making  were  very  restricted  industries,  especially  the  former, 
and  the  statistics  of  1895  mention  an  export  of  only  500  tons. 
But  the  impulse  was  already  given ;  and  the  combined  efforts 
of  agriculturalists  and  cattle-breeders,  directed  towards  the 
improvement  of  the  bovine  species,  were  about  to  give 
an  extraordinary  impetus  to  the  butter  -  making  industry. 
Let  us  see  how  the  situation  has  improved  between  1895,  the 
time  of  the  last  national  census,  and  1908,  the  year  in  which 
the  agricultural  and  pastoral  census  was  taken. 

This  latter  inventory  has  shown  that  in  1908  the 
Argentine  Republic  contained  29,119,625  head  of  cattle,  of 
which  2,16.^,900  were  milch  cows  and  12,825,904  were  cows 
emploj^ed  for  breeding  purposes.  That  is,  considering  the 
milch  cows  only,  we  do  not  find  a  very  extraordinary  increase 
since  1895,  although  all  agricultural  and  pastoral  industries 
have  undergone  such  a  remarkable  development.  It  is  ex- 
tremely probable,  however,  that  a  certain  number  of  milch 
cows  are  counted  among  the  cows  employed  for  breeding 
purposes,  as  the  latter  do  produce  milk,  whether  for  con- 
sumption on  the  farm  or  for  commercial  purposes.  Here  are 
the  figures  of  the  exportation  of  butter  from  1895  to  1908  : — 

Year.                                Number  of  Tons  Exported.  Value. 

180.5  494  £24,720 

1896  00;5  45,160 

1897  GOO  29,980 

189S  927  46,320 

1899    1,179  58,980 

1900    1,056  52,740 

1901    1,510  75,600 


242    THE  ARGENTINE  IN  THE  20th  CENTURY 


Year. 
1902 
1903 
1904 
1905 
1906 
1907 
1908 


umber  of  Tons  Exported. 

Value. 

4,125 

£253,580 

5,350 

426,580 

7,459 

423.560 

5,393 

431,460 

4,405 

352,400 

3,035 

242,800 

3,550 

284,000 

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These  figures  are  sufficiently  satisfactory,  but  they  are  far 
from  representing  the  possibilities  of  the  future,  when  the] 
improvement  of  breeds  and  the  establishments  of  new 
creameries  will  permit  of  the  manufacture  of  butter  on  a  far 
larger  scale. 

Among  the  present  stock  of  30,000,000  cattle  there  ought 
to  be  a  proportion  of  at  least  45  per  cent,  of  milch  cows,  or, 
12  millions  ;  at  the  very  least  8  millions.  Counting  upon  aJP"* 
daily  yield  of  17'6  pints  of  milk  per  cow,  valued,  in  its 
original  state  or  in  the  form  of  butter  or  cheese,  at  2d.  perj 
litre,  or  l"136d.  per  pint,  we  obtain  a  sum  of  £64,000  perS' 
diem,  or  £23,000,000  per  annum. 

But  these  calculations  are  purely  theoretical.  One  thing, 
however,  we  can  say  to  the  credit  of  the  countr}^  and  that  is 
that  its  dairy  industry  is  admirably  adapted  to  the  require 
ments  of  a  great  city  such  as  Buenos  Ayres,  which  must  per- 
force obtain  that  essential  aliment,  milk,  under  the  most 
favourable  conditions  of  price  and  quality.  An  extremely 
perfect  equipment  enables  the  industry  to  utilise  its  by- 
products. The  problem  is  not  whether  the  Argentine  can 
produce  such  a  quantity  of  butter,  but  to  whom  it  can  sell  it, 
for  in  America  Brazil  is  its  only  customer,  while  in  Europe  ■ 
it  has  to  struggle  against  the  competition  of  such  countries  as 
France  or  Switzerland,  which  countries  it  would  be  difficult 
to  displace. 

As  for  cheese,  we  quote  only  from  memory  ;  its  production 
is  practically  limited  by  local  requirements.     The  most  im- 
portant establishment  in  this  line  is  that  belonging  to  Senores      '^-tiitL 
A.  &  R.  Luro,  on  their  estate,  San  Pascual  del  Moro.     Here  the       'i;  t.-^ 
"  moro  "  cheese  is  made,  an  imitation  of  the  Roman  cheese, 
which  is  consumed  in  large  quantities  by  the  Italian  colony. 

Breweries. — Although  not  directly  dependent   upon   the^      fai  It 
produce  of  the  soil,  since  the  country  produces  no  hops,  and,    |  k^Wi 


I 


THE  GREAT  ARGENTINE  INDUSTRIES       243 

very  little  barley,  we  will  nevertheless  mention  the  industry 
of  brewing,  as  one  which  is  at  present  in  a  prosperous  con- 
dition. It  is  undertaken  by  a  number  of  limited  liability  com- 
panies, of  which  the  most  important,  due  to  the  initiative  of  M. 
Bemburg,  is  the  Brasserie  Argentine  de  Quihnes,  a  French  com- 
pany with  a  capital  of  £360,000,  which  brews  about  3,960,000 
gallons  of  the  8,360,000  gallons  consumed  by  the  nation. 

Next,  with  a  much  smaller  output,  comes  the  Bieckert 
Company,  with  a  capital  of  £362,880,  and  an  output  (in  1904) 
of  1,349,390  gallons  ;  the  Cerveceria  Palermo,  with  a  capital 
of  £132,000,  and  an  output  of  1,2(54,690  gallons  ;  the  Rio 
Segundo,  in  the  Province  of  Cordoba,  with  a  capital  of 
£80,000,  and  an  output  of  423,810  gallons  ;  and  the  Fabrica 
Nacional  de  Cerveza,  with  a  capital  of  £120,000,  and  an  out- 
put of  540,540  gallons. 

Here  are  the  statistics  of  production  and  consumption  for 
the  last  six  years  of  the  thirty-two  Argentine  breweries : — 

Year. 

1902 
1903 
1904 
1905 
1906 
1907 


The  national  product  has  won  a  complete  victory  over 
the  foreign  article,  the  importation  of  which  is  now  negligible  : 
and  it  has  also  popularised  the  liquid  dear  to  Ganibrinus, 
which  ten  years  ago  was  still  a  luxury.  One  can  only  regret 
that  agriculture,  whose  development  has  of  late  been  so 
enormous,  has  not  as  yet  liberated  the  brewery  from  the 
necessity  of  going  to  the  foreigner  for  his  malt,  a  product  of 
barley  which  is  the  principal  raw  material  of  beer.  Hitherto, 
according  to  Girola,  the  native  barleys  have  been  very  little 
used,  as  they  are  not  appreciated  as  they  deserve  to  be  ;  and 
the  growers,  on  the  other  hand,  have  not  taken  sufficient 
pains  to  produce  a  good  brewer's  barley.  We  must  hope 
that  this  situation  will  soon  be  changed,  and  that  more  pains 
will  be  taken  in  the  numberless  fertile  valleys  of  the 
Argentine  in  the  growing  of  barley  ard  its  improvement. 


Production 

Consumption 

(pints). 

(pints). 

49,096,235 

46,933,520 

57,043,272 

56,360,350 

65,663,824 

65,077,538 

94,264,637 

86,833,214 

113,967,478 

113,898,794 

123,404,693 

115,746,857 

.503,440,139 

484.850,273 

244    THE  ARGENTINE  IN  THE  20th  CENTURY 

Spirits. — The  production  of  alcohol,  unlike  that  of  other 
industrial  products,  is  rapidly  decreasing.  In  1907  only 
3,823,336  gallons  were  produced,  while  in  1897  the  production 
was  nearly  6,600,000  gallons.  But  we  must  not  forget  that 
the  duty,  which  was  originally  7  centavos  per  litre  (6-72d.  per 
gallon),  was  in  1898  increased  to  1  piastre  per  litre,  or  8s. 
per  gallon  ;  nearly  five  times  the  prime  cost  of  the  spirits. 

Weaving. — In  concluding  this  sketch  of  the  chief  in- 
dustries of  the  country  which  are  connected  either  with 
agriculture  or  stock-raising,  it  is  not  out  of  place  to  speak  of 
those  which,  although  so  far  scarcely  developed,  may  do 
better  in  time  under  favouring  circumstances. 

With  the  development  of  cotton-planting  and  a  plentiful 
supply  of  wool,  it  seems  that  a  large  number  of  looms  might 
be  profitably  established  and  operated  in  the  Argentine 
But  hitherto  this  industry,  of  prime  importance  though  it  be, 
has  been  held  in  check  by  the  expense  of  the  necessary 
machinery  and  of  coal,  which  has  to  be  imported  from  abroad, 
and  the  scarcity  of  labour. 

Tanning. —  This  industry  too,  ought  in  time  to  occupy  a 
place  of  far  greater  importance  than  it  does  now ;  for  the 
raw  materials — hides  and  quebracho,  the  best  of  tanning 
media,  are  present  in  abundance.  To  understand  the  station- 
ary condition  of  this  industry  we  must  remember  that  it 
would  require  a  considerable  spare  capital,  as  the  hides  have 
to  remain  in  the  vats  for  several  months,  during  wliich  time 
the  tanner  has  need  of  capital  at  low  terms  of  interest,  which 
up  to  the  present  time  has  not  been  available  in  the 
Argentine. 

Quebracho  Wood, — Considering  its  future  prospects,  we 
must  give  a  special  place  to  the  industry  wliich  exploits 
quebracho  timber ;  converting  the  balks  into  railway  sleepers, 
or  extracting  their  tannin. 

Red  quebracho  is  found  scattered  profusely  through 
the  hundreds  of  square  leagues  of  the  country  known 
as  the  Chaco,  which  is  situated  between  24°  and  28°  of 
south  latitude,  and  59°  and  64°  of  west  longitude,  and 
also  in  the  Provinces  of  Santa  Fe,  Santiago  de  I'Estero 
and  Corrientes.  The  Chaco  quebracho  is  superior  to  that 
of   Santiago,    which   has  the  misfortune  to  grow  in  nitrous 


THE  GREAT  ARGENTINE  INDUSTRIES       245 

alkaline  soil,  where  the  trees  do  not  reach  any  considerable 
dimensions.  The  Tucuman  product  is  good,  as  it  grows  in  a 
damp  soil,  when  it  grows  well  and  is  full  of  sap.  Best  of  all 
is  the  red  quebracho  of  Chaco;  it  is  the  richest  in  tannic 
products ;  according  to  an  analysis  made  in  the  United 
States,  it  contains  30  per  cent,  of  tannin,  while  the  Santa  Fe 
product  contains  less  than  26  per  cent. 

Although  quebracho  wood  is  absolutely  impervious  to  rot, 
and  may  thus  be  used  in  building,  for  piles,  quays,  sleepers, 
etc.,  it  is  exploited  more  especially  for  the  production  of 
tannin,  as  more  profit  is  made  by  so  treating  it.  A  sleeper 
requires  a  good-sized  log,  considerable  time,  and  much 
labour,  to  say  nothing  of  the  loss  of  wood  ;  while  the 
quebracho  extract  may  be  obtained  from  logs  of  any  size. 
To-day  the  value  of  a  sleeper,  loaded  on  the  track,  is  worth 
6s.  2d.,  while  three  times  as  much  may  be  made  by  extracting 
the  tannin.  For  this  reason  the  principal  companies  engaged 
in  the  quebracho  trade  have  abandoned  the  manufacture  of 
sleepers,  so  that  certain  railway  companies — the  Buenos 
Ajres  Western,  for  example — have  had  to  content  them- 
selves with  iron  sleepers. 

Until  quite  lately  quebracho  wood  was  sawn  into  large 
round  or  squared  balks,  which  were  then  sent  abroad,  chiefly 
to  Germany,  where  the  tannin  was  extracted.  During  the 
five  years,  1899-1903,  1,044,000  tons  of  logs  were  exported; 
in  1903,  200,201  tons;  in  1904,  252,723  tons;  in  1905,  285,897 
tons;  in  1906,  230,000  tons;  in  1907,  246,514  tons;  and 
during  the  first  six  months  of  1908,  127,609  tons.  Various 
foreign  and  native  companies  were  formed,  with  large 
capitals,  to  convert  the  wood  into  extract  of  ^tannin,  and  to 
export  it  in  this  form. 

These  companies  are  :  the  Compania  Industrial  del  Chaco, 
with  a  capital  of  £348,000  and  two  factories  ;  one  at  Las 
Toscas,  in  Santa  Fe,  with  a  monthly  output  of  1000  tons  of 
extract,  and  one  at  Calchagin,  in  the  same  Province,  which 
produces  600  tons  per  month.  These  factories  are  equipped 
with  German  plant. 

This  company  enjoyed  a  season  of  great  prosperity  in 
1904 ;  although  its  factories  produced  only  12,000  tons  of 
extract  instead  of  36,000,  as  they  could  have  done,  a  dividend 


246    THE  ARGENTINE  IN  THE  20th  CENTURY 

of  42  per  cent,  was  declared.  Since  then  the  lack  of  outlet 
and  the  low  prices  have  paralysed  the  development  of  this 
industry. 

Another  tannin  factory,  able  to  produce  250  tons  of 
extract,  has  been  established  by  Herwig  Brothers  at  Pehuaj6,' 
Province  of  Corrientes. 

The  Compania  Industrial  del  Chaco  is  also  about  to  erect, 
at  Resistencia,  a  factory  with  a  capacity  of  300  tons  of  extract 
per  month. 

El  Quebracho  is  the  last  of  the  companies  established  for 
the  extraction  of  quebracho  tannin,  and  this  also  began  to 
work  under  the  most  auspicious  financial  conditions.  Its 
factories  are  installed  at  Fives-Lille,  Province  of  Santa  Fe, 
on  land  belonging  to  the  "  Kemmerich  Products  Co." ;  these 
liave  been  equipped  with  the  most  perfect  machines  of 
German  make.  The  capital  of  this  enterprise  amounts  to 
£32,000,  which  it  is  hoped  will  be  repaid  by  the  profits  of  the 
first  few  years.     The  monthly  output  is  450  tons. 

The  Mocovi  Tannin  Co.,  floated  with  a  capital  of  £60,000, 
has  a  factory  some  60  miles  east  of  Los  Amores  (Santa  F^),  and 
has  a  capacity  of  300  tons  per  month. 

The  firm  of  Hardy  &  Co.,  of  Las  Palmas,  near  Resistencia, 
own  a  factory  which  cost  £50,000,  and  produces  200  tons  of 
extract  monthly. 

The  Formosa  company,  which  deals  in  timber  and 
quebracho  tannin,  has  a  capital  of  £200,000.  This  company 
owns  96  square  leagues  of  forest — some  880  square  miles — 
which  are  estimated  to  contain  2  million  tons  of  quebracho- 
This  company  intends  to  establish  a  factory  capable  of  pro- 
ducing 15,000  tons  of  tannin  yearly. 

The  Compania  Azucarera  de  Resistencia,  with  a  capital  of 
£22,700,  produces  80  tons  of  extract  monthly,  and  the  factory 
of  M.  Benito  Pinasco,  at  Guaycuru,  on  the  Santa  F^  railway 
line,  produces  30  tons. 

Besides  these  factories,  Senors  Charles  and  Joseph  Casado, 
the  Argentine  owners  of  2800  square  leagues  of  land  (over 
25,000  square  miles),  in  the  Paraguayan  Chaco,  have  estab- 
lished two  factories,  one  at  Puerto  Casado  and  the  other  at 
Puerto  Sastre,  which  produce,  respectively,  500  and  1000  tons 
of  extract  per  month. 


i 


THE  GREAT  ARGENTINE  INDUSTRIES        247 

The  average  yield  of  quebracho  wood  is  25  per  cent,  of 
extract ;  but  as  the  extract  contains  a  number  of  resinous 
and  colouring  matters,  which  must  be  eliminated  during  the 
process  of  manufacture,  the  net  yield  is  22  to  23  per  cent, 
of  solid  extract  containing  20  per  cent,  of  water,  which 
contains  70  to  73'5  per  cent,  of  tannic  oxide — that  is, 
pure  tannin. 

The  system  employed  in  extracting  the  tannin  is  based 
upon  diffusion.  Firstly,  the  wood  is  reduced  to  powder 
by  means  of  machines  which  cut  or  saw  the  wood,  into 
which  the  logs  are  fed  entire.  Then,  when  the  wood 
is  converted  into  sawdust  or  fine  chips  or  shavings,  it 
is  passed  through  extractors  or  diffusers,  which  separate  the 
cellulose  from  the  tannin,  which  is  finally  concentrated  to 
the  degree  demanded  by  the  market  by  means  of  vacuum 
pans. 

During  five  years,  from  1904  to  1908,  the  exports  were: 
20,111  tons  in  1904;  29,408  tons  in  1905;  30,839  tons  in 
1906  ;  28,190  tons  in  1907  ;  48,160  tons  in  1908. 

Germany  and  the  United  States  are  the  chief  buyers  of 
this  valuable  product,  which  forms  the  principal  wealth  of 
the  northern  part  of  the  Argentine. 

In  the  first  edition  of  this  book  we  prophesied  a  rapid 
and  prosperous  development  for  this  industry,  which  had 
already  received  a  considerable  impetus ;  unhappily  this 
prediction  has  not  been  realised  in  practice,  and  the 
quebracho  industry  has  suffered,  not  precisely  a  crisis, 
but  a  diminution  of  its  outlets  which  has  seriously  pre- 
judiced its  interests. 

This  trouble  is  due  to  various  causes.  Firstly,  the  ruinous 
competition  between  the  various  firms  producing  quebracho 
tannin  ;  a  competition  which  has  now  happily  disappeared, 
thanks  to  an  arrangement  concluded  between  the  principal 
companies,  on  the  initiative  of  M.  Hermann  Schlieper ; 
secondly,  to  the  almost  prohibitive  duties  which  the  German 
Government  has  imposed  upon  the  importation  of  the 
product ;  thirdly,  the  indiff'erence  shown  by  the  railway 
companies  in  using  on  their  permanent  way  sleepers  of  steel 
rather  than  of  quebracho,  although  the  latter  is  more  durable. 
It  is  to  be  hoped,  however,  that   in   course   of   time   these 


248    THE  ARGENTINE  IN  THE  20th  CENTURY 

causes  will  disappear,  and  that  this  industry  will  in  future 
recover  all  the  elements  of  progress. 

The  Timber  Industry. — Another  industry  which  is  equally 
dependent  upon  the  forestal  wealth  of  the  Argentine  is  that 
whose  object  is  the  exploitation  of  the  various  and  valuable 
kinds  of  wood  to  be  found  in  various  parts  of  the  country, 
especially  in  the  forests  of  the  Chaco  and  of  Formosa. 

The  variety  of  costly  woods  to  be  found  in  these  forests 
is  astonishing.  Recently  more  than  thirty-three  species  have 
been  classified,  all  of  industrial  value  ;  the  best  known,  besides 
the  quebracho,  being  the  acacia,  algarrobo,  button-tree, 
lapacho,  bay,  the  smaller  cedar,  and  many  other  varieties, 
black,  white  and  red. 

To  exploit  this   forestal  wealth  a  limited   company  has 
lately  been  formed  with  a  capital  of  £352,000,  which  proposes  i 
to  erect  two  important  saw-mills  in  the  Chaco.     This  com- 
pany already  owns  about  2300  square  miles  of   forest,  and 
is  thinking  of  increasing  its  domain  by  further  purchases. 

Fisheries. — Finally,  quitting  the  forests  for  the  seas,  we 
must  mention  one  other  industry,  at  present  unimportant, 
but  apparently  capable  of  considerable  development :  namely, 
the  sea  fisheries. 

Owner  of  an  immense  coast-line  bathed  by  the  southern 
seas,  the  Argentine  has  an  appreciable  store  of  wealth  at  her 
disposal ;  which  so  far  has  been  drawn  upon  only  in  a  modest 
and  almost  secret  manner,  but  which  is  now  beginning  to 
attract  attention,  to  the  great  benefit  of  the  country  and  of 
those  who  have  entered  upon  this  industry. 

Since  Prof.  Nordenskjold  wintered  in  Antarctic  waters, 
Captain  Larsen  has  been  able  to  report  a  source  of  great 
wealth,  which  can  be  easily  and  profitably  exploited,  in  the 
fishing  of  these  waters  ;  and  upon  his  arrival  in  Buenos 
Ayres  he  put  himself  in  communication  with  a  group  of 
Argentine  capitalists,  who  decided  to  form  a  limited  company  \'k 
by  the  name  of  La  Pesca,  with  a  capital  of  £32,000.  :  ] 

The  results  of  the  first  season's  fishing  was  so  productive,  \  | 
and  the  number  of  whales  harpooned  and  "  cut  in  "  so  large,  |  \ 
that,  according  to  a  report  which  has  been  sent  us,  this  '  t, 
company  was  able,  at  the  end  of  the  first  year,  to  return  the  \\ 
capital  sunk  in  the  firm  of  dividends. 


THE  GREAT  ARGENTINE  INDUSTRIES       249 

Naturally  such  results  cannot  fail  to  draw  new  adventurers 
into  this  industry,  which  in  turn  will  increase  and  develop 
the  wealth  of  the  country,  at  the  same  time  procuring  for 
the  country  a  class  of  men  formed  by  the  strenuous  labour 
of  Antarctic  life  ;  a  class  of  which  the  young  Argentine  navy 
has  the  greatest  need. 


CHAPTER    III 

MINES,   ELECTRICAL    AND   OTHER    INDUSTRIES 

The  Argentine  has  not  entered  the  industrial  age— She  has  no  coal-mines  in 

operation,  no  natural  motive  forces  of  any  importance. 
Mines — Symptoms  of  the  awakening  of  the  mining  industry^Numerous  lodes 

in  the  Andes — The   mines  of   La  Rioja  and   Catamarca — Mines   in    other 

provinces  and  territories — Mining  legislation. 
Elkctric  Industries — Tramways  ;    their  development,  their  perfected  equip- 
ment,  and    their    profits — Progress   of     electric    lighting— Telegrapks— 

Telephones. 
Various  Industries — List  of  various  industries  established  in  Buenos  Ayres, 

according  to  the  last  census,  with  the  value  of  their  products. 
Comparison  between  the  statistics  of  1895  and  those  of  1904  —Progress  realised 

in  1908 — "Workshops  and  factories. 

THE  Argentine  Republic,   as  we  have  already  on  various  ' 
occasions  explained,  has  not  yet  entered  upon  the   in- 
dustrial  phase.     All   its   capital   and  all   its   energies   tend 
toward  the  exploitation  of   the  soil,  and  as  the  results  are  | 
greater  than  the  boldest  speculator  could  have  predicted,  the 
country  has  no  need  at  present,  with  its  small  population, 
to  launch  itself  into  the  unknown  by  entering  the  province! 
of  industry. 

Moreover,  the  Argentine  does  not  so  far  possess  coal 
or  iron  measures  easily  workable,  and  has  very  little  labour 
at  its  disposal,  and  therefore  should  not  disperse  its  activities 
among  too  many  objects.  It  is  its  best  policy  to  limit 
itself  to  producing  articles  that  it  can  make  more  cheaply 
than  the  foreigner;  not  artificially  to  develop  its  industries 
in  the  shelter  of  an  ultra-protectionist  tariff.  It  would  fall 
to  the  consumer  to  pay  for  such  products  of  the  national 
industry,  and  the  state  would  lose  a  serious  portion  of  its 
revenues. 

In  other  words,  we  may  well  ask  whether  the  Argentine, 
in   addition  to  its  agricultural  wealth,  should  pretend  to  a 
great  industrial  future,  like  that  of  the  United  States. 
250 


So 

Inspect 
iiJisii 
jeasir 
0 
'§k 
im 
ft 
istni' 
(iteBt, 
iiuea 
]mi 
few: 
ii 
ibi 
h  I 

'li 

m 
m\<: 
m: 
ittji 
iii 


MINES,  ELECTRICAL  AND  OTHER  INDUSTRIES  251 

So  far  we  cannot  reply  in  the  affirmative  ;  not,  at  least, 
under  present  conditions.  However  rich  the  subsoil  of  the 
country  may  be,  a  matter  at  present  uncertain,  especially  in 
respect  of  coal  and  iron  measures,  which  are  the  basis  of  all 
industries,  we  must  remember  that  the  majority  of  these 
measures  are  situated  in  the  region  of  the  Cordillera,  4000 
to  5000  feet  above  sea-level,  over  900  miles  from  the  coast, 
far  from  roads  or  waterways,  and  are  consequently  very  badly 
situated  for  the  establishment  of  industrial  centres. 

What  coal  and  iron  the  Argentine  may  possess  is 
distributed  over  a  region  of  some  thousands  of  miles  in 
extent,  which  does  not  appear  to  contain  continuous  lodes 
or  measures,  and  in  which  there  are  no  real  valleys  or  river- 
basins.  Putting  all  questions  of  tariff  aside,  but  considering 
the  constant  lowering  of  freights,  we  think  the  Argentine 
will  always  find  it  cheaper  to  obtain  its  supplies  from 
abroad,  except  such  as  it  can  produce  economically,  rather 
than  attempt  to  embrace  all  industries  in  its  dreams  of 
greatness. 

Neither  can  we  expect  from  the   utilisation  of   natural 

motive  forces  a  development  which   might  in  some  degree 

compensate   for   the   absence   of    fuel.      There    are   a    few 

waterfalls  in  C(5rdoba  and  in  Tucuman,  but  such  energy  as 

they  might  furnish  would  hardly  allow  one   to  hope  much 

from  their  adaptation  to  industrial  uses.     One  of  the  most 

important  of  these  falls  is  that  below  the  Barrage  San  Roque, 

in  the  Sierra  de  Cordoba ;  it  belongs  to  the  North  American 

Company,  "  Luz  y  Fuerza  "  (Light  and  Force).    The  company's 

plant  gives  a  yield    of   about   3000   horse-power,  which   is 

employed,  for  the  greater  part,  in  providing  light  and  motive 

;  power  to  the  town  of  C6rdoba,  and  also  for  the  production  of 

I  carbide  of  calcium.     Another  installation,  belonging  to  the 

I  Molet  Company,  has  a  capacity  of  some  700  or  800  horse- 

,  power,  which  is  employed  in  the  same  manufacture. 

The  falls  of  the  Yguassu,  on  the  upper  Parana,  some  230 
miles  above  Corrientes,  on  the  confines  of  Brazil,  Paraguay 
and  the  Argentine,  have  been  described  as  a  marvel  of  nature. 
It  would  seem  that  these  falls  represent  a  force  three  times 
greater  than  Niagara ;  their  width  is  12,000  feet,  or  more 
than  two  miles,  with  a  fall  of  212  feet.     Unfortunately  this 


252    THE  ARGENTINE  IN  THE  20th  CENTURY 

cataract  is  on  the  border  of  the  Argentine  territory,  in  s 
region  of  forests  accessible  only  with  difficulty,  and  wil: 
probably  flow  for  many  years  yet  before  any  one  profits  by 
this  enormous  natural  source  of  power. 

Mines. — Although  the  industrial  future  of  the  Argentinti 
is  as  yet  by  no  means  clear,  we  must  admit  that  during 
the  last  four  years  there  has  been  a  livelier  movement  in 
favour  of  gold,  silver,  and  copper  mining,  which  has  resulted  t 
in  the  flotation  of  several  important  limited  companiesi 
It  was  to  support  these  first  steps  that  the  Government 
built  an  aerial  railway — one  of  the  boldest  works  evei 
attempted  in  the  whole  world — to  exploit  the  rich  mines  ol 
Famatina. 

"Over  the  whole  stretch  of  the  eastern  slopes  of  the 
Andes,"  says  an  important  official  publication  *  which  we 
take  for  guide,  "from  Bolivia  to  Tierra  del  Fuego,  the 
existence  of  numerous  mineral-bearing  regions  is  proved 
notably  in  the  Provinces  of  Mendoza,  San  Juan,  La  RiojaT 
Catamarca,  Salta,  Jujuy,  Tucuman,  Cdrdoba,  and  San  Luisj 
where  traces  of  ancient  mineral  workings  have  beeii 
discovered."  t 

There  are  many  villages  which  ever  since  the  Spaniskj 
Conquest  have  drawn  their  sustenance  from  the  gold  andl 
silver  which  their  inhabitants  obtain,  by  rudimentarjj 
processes,  from  the  beds  of  stream  or  river,  and  by  plaiii 
mining.  Also,  despite  the  difficulties  of  transport,  various! 
well-organised  companies  have  obtained  very  fair  resultsj 
from  their  workings,  since  they  obtained  their  concessiomi 
a  few  years  ago.  Now  that  the  feelers  of  the  railwayi  ijurij],. 
systems  have  reached  these  districts,  and  the  raining! 
companies  have  established  aerial  cable-ways  to  connect  them, 
with  the  mines,  we  can  already  perceive  a  greater  vitality; 
in  this  industry.  i 

In  addition  to  the  wealth  of  the  Cordillera,  prospectors  arei 
discovering  new  lodes  in  the  interior  of  the  country ;  but,  as: 
always  happens,  miners  prefer  to  gather  in  already  familiar 


*  Description  nommaire  de  la  Ripuhlique  Argentine  comme pays  d' immigration 
1904. 

f  The  Argentine  lost  much  of  itn  mineral  -wealth  when  Potozi  and  La  Pa2 
were  lost  to  Bolivia. — [Trans.] 


m\: 


I 


MINES,  ELECTRICAL  AND  OTHER  INDUSTRIES  253 

districts,    rather    than    undertake   long  journeys,   and    the 
labour  of  prospecting  at  their  own  expense. 

The  best-known  mines  of  the  Argentine  are  distributed  as 
follows : — 

In  the  Province  of  Mendoza  there  are  mines  of  copper, 
""It  silver-bearing  galena,  gold-bearing  quartz,  coal,  alabaster, 
' "!  slate,  and  marble,  and  wells  of  petroleum  ;  in  the  Province  of 
'"*!  San  Juan,  of  gold-bearing  quartz,  silver,  copper,  antimony, 
"'*?  coal,  sulphur,  and  amianthus.*  In  view  of  the  development 
^^^\  which  this  region  may  undergo  through  the  exploitation 
'^®f  of  the  coal-measures,  the  Great  Western  Railway  has 
''«!  decided  to  construct  a  branch  line  as  far  as  the  coal  mines 
of  Salagasta  (Mendoza). 

The  Province  of  La  Rioja  has  been  known  for  a  long 
time  for  its  rich  mines  of  metallic  silver,  and  also  for  its 
copper  mines,  whose  ores  contain  a  high  percentage  of  gold 
and  silver;  and  for  its  gold  "placer"  mines.  It  is  to  facili- 
tate the  working  of  these  mines  that  the  aerial  cable-way 
is  being  constructed,  which  will  unite  Cerro  de  Famatiua 
and  the  mining  centre  of  Chilecito  with  the  railways. 
Here,  as  everywhere,  skilled  miners  are  somewhat 
scarce. 

The  Province  of  Catarriarca,  the  centre  of  the  Capillitas 
mining  country,  possesses  copper  mines  with  a  high  percentage 
of  silver  and  gold,  which  have  been  worked  for  more  than 
thirty  years.  These  mines,  which  are,  it  appears,  very  rich 
in  minerals,  have  been  acquired  by  a  foreign  company,  and 
will  be  the  object  of  an  important  enterprise;  here,  too,  an 
aerial  cable-way  will  be  built  to  transport  the  ore  from  the 
mines  to  a  lower  level. 

There  are  also  in  this  region  two  important  smelting 
works  ;  "  Le  Pilcian  "  and  "  La  Constancia,"  which  are  buried 
in  the  depths  of  the  forests  of  carob-trees,  which  furnish 
abundant  fuel.  In  other  parts  are  found  surface  veins 
of  copper,  silver-bearing  galena,  bismuth,  antimony,  mica, 
gold-bearing  quartz,  as  well  as  "  placer "  mines  and  coal- 
measures. 

The  Provinces  of  Salta  and  Jujuy,  which  possess  rich  veins 
of  auriferous  quartz,  argentiferous  galena,  copper,  borate   of 

'  AmiunthuB — the  beBt  quality  of  asbestos. — [Tkans.] 


254    THE  ARGENTINE  IN  THE  20th  CENTURY 


t 


lime,  lignite  and  petroleum,  are  famous  for  the  gold  obtained 
from  the  streams  that  descend  from  their  mountains. 
Undertakings  have  been  formed  with  foreign  and  native 
capital,  and  profitable  results  are  expected.  The  extension  of 
the  Argentine  railways  to  Bolivia  will  still  further  develop 
the  exploitation  of  mining  districts  all  through  this 
region. 

In  former  times  silver  mines  were  worked  in  the 
Province  of  Tucuman.  In  Aconquija  also  we  find  mines 
of  copper  which  must  be  a  continuation  of  those  of 
Catamarca. 

The  Provinces  of  Cordoba  and  San  Luis,  besides  ascer- 
tained veins  of  gold-bearing  quartz,  galena  and  copper,  con- 
tain mines  of  manganese  and  wolfram,  and  well-known 
quarries  of  marble,  and  of  onyx,  both  green  and  of  other 
shades. 

In  the  Territories  of  Tierra  del  Fuego  and  Santa  Cruzi  ^ 
the  sands  along  the  Atlantic  coast  contain,  especially  after' 
storms,  an  abundance  of  gold  in  powder  and  small  nuggets,  j 
whose  extraction  gives  employment  to  numbers  of  workers.  *  i 
There  also  are  seams  of  lignite  and  of  peat.  Finally,  in  Santa  !i 
Cruz  there  are  several  salt  workings,  the  produce  being  sent  | 
to  Buenos  Ayres.  j 

The  River  Chuhut,  in  the  Territory  of  Chubut,  brings i lain] 
down  fine  gold  along  its  bed,  as  do  its  numerous  small  ji  ^i 
tributaries,  which  rise  in  the  Andean  slopes.  The  presence  j 
of  gold  more  than  100  miles  from  the  Cordillera  tempted  i 
some  colonists  to  organise  an  expedition  ;  at  the  foot  of  the 
mountain  they  found  gold  in  nuggets. 

Another  company  exploits  the  salt  pits  of  the  Valdez 
Peninsula,  and  another  the  quarry  of  flat  granite  slabs,  known 
as  the  Atlas  Quarry. 

For  many  years  now  large  quantities  of  gold  have  been 
found  in  the  rich  "  placers "  of  the  Territory  of  Neuquen, 
where  copper  also  has  been  discovered,  silver-bearing  galena, 
coal,  and  petroleum.  The  gold  taken  out  of  the  washers  of 
Villa  Michico  and  the  neighbourhood  is  estimated  at  330  lb. 
avoirdupois  annually. 

'  A  few  years  ago  a  company  was  formed  with  North  Amnrican  nnd 
Argentine  capital  to  work  the  sands  in  this  manner  in  Tiorra  del  Fuegu. 


MINES,  ELECTRICAL  AND  OTHER  INDUSTRIES  255 

In  the  Territory  of  Rio  Negro  there  arc  abundant 
quarries  of  gypsum,  limestone,  and  other  building 
materials ;  in  that  of  the  Pam-pa  Central  copper  has 
been  recently  discovered  and  is  being  worked  ;  in  that  of 
Misiones  there  is  native  copper,  iron,  and  manganese  ;  in 
that  of  the  Andes  (Puiia  de  Atacama),  there  are  immense 
deposits  of  borate  of  lime,  as  well  as  veins  of  quartz  and 
"  placers," 

Considering  the  vast  extent  of  these  territories,  which 
have  never  been  seriously  explored  except  at  a  few  points,  we 
have  every  reason  to  believe  that  it  will  be  many  years 
before  we  have  even  an  approximate  knowledge  of  the 
mineral  wealth  they  contain ;  but  the  data  gathered  up  to 
the  present  time  augur  well  for  the  future  of  the  mining 
industry  in  the  Argentine. 

We  will  add  finally,  as  a  further  reason  for  success,  the 
fact  that  the  law  regarding  mines  is  remarkably  liberal ; 
the  State  may  not  exploit  them  on  its  own  account,  but 
ciincedes  them  to  any  adult  applicant  capable  of  administer- 
ing his  own  property. 

The  same  mining  laws  are  in  force  throughout  the 
country.  To  acquire  a  claim  it  suffices  to  present  a  written 
demand,  containing  an  exact  indication  of  the  position  and 
nature  of  the  claim  demanded,  the  details  of  its  discovery, 
and  all  other  useful  information,  accompanied  by  a  sample 
of  the  mineral.  Immediately  upon  the  presentation  of  this 
demand  the  administration  enters  it  with  the  date  of  de- 
position, in  order  to  prove  the  right  of  priority;  and 
directly  the  concession  has  been  surveyed  and  delimited, 
the  claimant  has  full  rights  in  his  mine  and  may  dispose 
of  it  as  he  wills.  The  mine  is  untaxed,  and  so  are  the 
mineral  products,  whether  sold  at  home  or  abroad.  The 
only  obligation  imposed  upon  the  miner  is  that  he  shall 
work  his  mine  with  at  least  four  miners  during  230 
days  of  the  year;  if  this  condition  be  not  fulfilled,  any 
other  person  may  demand  the  concession  of  the  abandoned 
mine.* 

*  Senator  Domingo  Peree  has  just  laid  before  Parliament  a  projected  law 
Bubstituting  a  fine  or  tax  for  this  obligation. 


256    THE  ARGENTINE  IN  THE  20th  CENTURY 

The  Electrical  Industry. — It  is  greatly  to  the  credit 
of  the  Argentine  that  everything  that  makes  for  pro- 
gress, for  an  increased  welfare  or  greater  convenience, 
is  immediately  applied  by  the  Republic.  The  latter 
quickly  absorbs  all  improvements  and,  profiting  by  the 
experience  of  older  nations,  immediately  puts  new  pro- 
cedures into  practice,  instead  of  lingering  in  the  rut  of 
outworn  systems.  Thus  it  was,  for  example,  in  the  casei 
of  the  electrical  industry.  The  Argentine  has  no  need,  ini 
this  respect,  to  envy  the  most  advanced  nations.  Ini 
Buenos  Ayres — for  only  the  large  centres  can  be  progres-' 
sive  to  this  extent — all  the  tramway  and  electric  lightingij 
concerns  are  most  excellently  equipped,  and  are  in  this! 
matter  equal  to  the  best  installations  of  England  or  the) 
States.  j 

The  electric  tramway  companies,  whose  tracks  crossi 
Buenos  Ayres  in  every  direction,  are  seven  in  number,], 
forming  a  network  of  lines  which  are  distributed  as' 
follows : — 

The  "  Anglo  -  Argentine  "  Company,  18'8  miles;  the! 
"  Capital "  Company,  34'7  miles  ;  the  "  Metropolitan  "! 
Company,  19'8  miles;  the  "Grand  National,"  76*9  miles;! 
the  "Compaguie  Lacroze  de  Buenos  Ayres,"  44  miles;  the; 
"  Southern  Electric  Tramways,  49  miles ;  and  the  Harbour 
and  City  of  Buenos  Ayres,  6'8  miles. 

The  great  event  of  1908  was  the  amalgamation  of  these 
companies  by  the  "  Anglo-Argentine,"  which  proposes  to 
unite  these  lines  under  a  single  management,  in  order  tc 
form  a  vast  network,  comprising  all  the  principal  lines,  with 
the  exception  of  the  "  Compagnie  Lacroze  "  and  the"  Harboui 
and  City  of  Buenos  Ayres."  The  total  capital  invested  ic 
this  important  undertaking  amounts  to  not  less  than 
£14,000,000. 

It  is  to  be  hoped  that  this  great  financial  operation,  whieb 
will  place  the  Anglo-Argentine  Company  at  the  head  of  tb( 
most  important  tramway  companies  of  the  world,  will  not 
fail  to  benefit  the  public,  and  that  the  Company  will  alsc 
turn  its  attention  to  improving  its  equipment  and  to  lowering 
its  fares  to  a  uniform  rate. 

On  the  other  hand  the  number  of  passengers  carried  bj 


MINES,  ELECTRICAL  AND  OTHER  INDUSTRIES  257 

the  Buenos  Ayrea  tramways  is  constantly  increasing,  as  may 
be  seen  in  the  followinof  table : — 


Passengers  Carried. 

Gross 

Year. 

Horse 
Traction. 

Electric. 

Horse 
Traction. 

1901      .. 

.       95,430,421 

30,088,803 

£848,318 

1902      .. 

.       92,038,025 

33,593,734 

827,979 

1903     .. 

.       71,048,519 

62,670,779 

636,801 

1904     .. 

65,532,745 

82,740,352 

587,022 

1905     .. 

.       34,480,547 

174,455,022 

489,741 

1906     .. 

.       24,927,089 

175,773,158 

232,903 

1907     .. 

7,338,563 

217,702,183 

67,659 

1908     .. 

293,209 

254,780,627 

1,980 

Electric. 

Total  Profits. 

£294,822 

£1,143,140 

334,060 

1,162,0:39 

596,719 

1.233,520 

805,071 

1,370,093 

1,049,949 

1,539,090 

1,565,472 

1,798,375 

1,926,054 

1,993.793 

2,229,547 

2,231,527 

These  figures  go  to  confirm  all  we  have  said  as  to  the 
enormous  development  of  capital  in  the  Argentine,  and  of  its 
commercial  activity. 

Electric  Lighting. — In  the  matter  of  illumination,  Buenos 
Ayres  was  early  discontented  with  the  old  methods ;  electricity 
is  now  preferred  both  for  public  and  private  purposes.  To- 
day there  are  721  miles  of  gas  pipes  and  233  miles  of  electric 
cables. 

The  capital  of  the  electric  lighting  companies  is  estimated 
at  nearly  £2,000,000,  and  their  output  at  30,905  horse-power. 
The  electrical  supply  is  chiefly  in  the  hands  of  the  German 
Electricity  Company,  with  a  capital  of  £1,850,000,  which  has 
already  absorbed  the  two  companies  previously  in  existence. 
Its  equipment  was  furnished  by  the  famous  firm  of  Siemens 
Halske,  which  stands  in  the  front  rank  of  German  electrical 
manufacturing  firms. 

Telegraphs. — Another  mark  of  progress  is  the  con- 
tinual extension  of  the  telegraphic  system.  The  national, 
provincial,  and  private  lines  together  represent  to-day 
a  length  of  31,215  miles,  of  which  15,125  belong  to  the 
State ;  twenty  years  ago  the  mileage  was  barely  half  this 
figure. 

As  for  telegraphic  communication  with  the  exterior,  there 
are  two  foreign  cable  companies,  one  possessing  the  cable 
running  to  the  United  States  via  Galveston,  and  the  other 
that  communicating  with  Europe  via  Madeira.  Communica- 
tion between  London  and  Buenos  Ayres  is  now  established  in 
about  forty-five  minutes,  while  a  few  years  ago  the  average 
was  five  hours. 


258    THE  ARGENTINE  IN  THE  20th  CENTURY 

Telephones. — The  telephone  is  used  in  the  capital  and  the 
principal  towns — Rosario,  C6rdoba,  Santa  F6,  Tucuman, 
Mendoza,  etc.  Buenos  Ayres  is  connected  by  telephone  with 
Montevideo  (124  miles),  Rosario  (190  miles),  and  will  shortly 
be  connected  with  Bahia  Blanca  (437  miles).  The  two  com- 
panies established  in  Buenos  Ayres,  the  "  Telephonic  Union 
of  the  Rio  de  la  Plata "  and  the  "  Co-operative  Telephonic 
Company,"  represent  a  capital,  respectively,  of  £24)3,963  and 
£582,032. 

All  these  data,  which  we  merely  mention  in  passing,  go 
to  prove  that  the  Argentine  has  assimilated  all  the  details 
of  industrial  progress,  even  in  their  most  improved  forms. 
Experiments  in  wireless  telegraphy  are  now  being  made 
with  a  view  to  communicating  at  long  distance  with  the 
steamers  leaving  or  approaching  Buenos  Ayres. 

Various  Industries. — At  the  end  of  1908,  according 
to  the  statistics  of  the  official  industrial  census  of  that 
year,  which  was  undertaken  by  the  Department  of  Com- 
merce in  the  Ministry  of  Agriculture,  there  were,  in  the 
city  of  Buenos  Ayres,  10,349  factories  or  workshops, 
representing  a  capital  of  £23,443,144.  The  sales  of  these 
factories,  etc.,  for  1908,  amounted  to  £47,048,773.  The 
raw  material  consumed  was  worth  £25,223,681.  The 
motive  power  employed  in  these  factories  was  equivalent 
to  105,575  horse-power,  and  the  number  of  workers 
employed  was  118,315.  Of  the  owners,  14*8  per  cent, 
were  of  Argentine  nationality. 

If  we  compare  these  figures  with  those  of  the  municipal 
census  of  1904,  we  obtain  the  following  results: — 


Number  of  factories  and  workshops 

Capital  employed  

Sales  

Motive  power  consumed  (h.p.) 

Workmen  employed        

Raw  material  consumed 
Masters      or     owners     of      Argentine  \        V--^o  14-81 

nationality  (per  cent.)  ...  ...  j 

We  see  that  even  in  four  years  there  has  been  a  remark- 
able development  of  the  industries  of  Buenos  Ayres.  This 
development  is  especially  demonstrated  by  the  increase  of 


Census  of  1904. 

Census  of  1908. 

8,897 

10,349 

£8,733,127 

£23,443,144  „ 

£16,143,832 

£47,048,773  ., 

19,458 

1'05,57<'.      ■ 

()8,512 

118,315 

— 

£2,">,223,681 

MINES,  ELECTRICAL  AND  OTHER  INDUSTRIES  259 

the  capital  represented  by  the  sales  of  merchandise  or  manu- 
factured articles  and  by  the  horse-power  employed.  At  the 
end  of  four  years  the  capital  has  increased  by  nearly  300 
per  cent.,  the  sales  by  the  same  amount,  and  over  five  times 
the  motive  power  is  employed. 

This  progress  is  certainly  remarkable,  but  it  does  not 
perhaps  truly  represent  the  actual  progress  achieved.  The 
Director  of  the  Census,  Seuor  Ricardo  Pillado,  declares  that 
"the  general  opinion  prevalent  in  the  offices  of  the  census 
department  is  that  certain  important  items  of  information, 
relating  to  matters  of  great  interest,  have  been  concealed  by 
interested  persons.  Among  such  we  may  cite  the  value  of 
output,  the  amounts  of  sales,  the  capital  employed,  the 
number  of  employes,  etc.  ;  as  the  manufacturers  are  anxious, 
above  all,  to  shelter  themselves  from  a  possible  increase  of 
taxation  or  licences."  So  that  in  spite  of  the  satisfactory 
results  of  the  last  census,  in  spite  of  the  notable  increase  of 
wealth  and  industry  recorded,  the  figures  given  are  far  from 
representing  the  true  significance  of  the  industries  of  the 
capital  city. 

The  results  already  given  may  be  classified  as  follows, 
under  the  headings  of  the  kind  of  industry,  capital  employed, 
value  of  produce,  motive  power,  and  employes  engaged: — 


Value 

Number  of 

Motive 

Industries. 

Capital. 

of 

Hands 

Power 

Production. 

Employed. 

(H.P.). 

'ias   lighting,  electric  lighting. 

-  £6,712,470 
3,873,380 

lighting      installations,     and 

lant 

£2,227,376 

4,754 

66,392 

nentary  products    

10,520,532 

14,227 

11,756 

thing  and  toilette     

3,2.56,512 

9,156,774 

37,259 

2,586 

von  fabrics,  leather  and  furs 

1,967,672 

.5,084,053 

10,861 

5,461 

•.al  work,  etc. 

1,598,722 

2,916,793 

10,090 

4,311 

.raphic  arts,  paper       

1,489,525 

2,178,294 

8,296 

2,758 

Woodwork,  cabinet-making,  etc. 

1,461,103 

4,330,954 

11,730 

5,570 

Tobacco  factories 

605,487 

2,249,836 

2,829 

539 

Chemical  products        

432,160 

754,207 

1,774 

1,231 

Building             

408,056 

1,097,219 

4,415 

719 

Art  products,  ornaments,  etc. 

301,244 

729,903 

2,199 

367 

Various  industries 

1,364,881 
£23,421,318 

5,779,208 

9,875 
118,315 

3,895 

Totals      

£47,032,146 

105,57 

The  establishment  of  large  electric  works  which  furnish 
current  at  very  moderate  rates,  as  well  as  the  advantages  of 


260    THE  ARGENTINE  IN  THE  20th  CENTURY 

electro-motors  as  compared  with  steam-engines,  have  led  a 
number  of  industries  to  adopt  new  systems  of  motive-power.  | 
Of  a  total  of  105,575  horse-power,  12,505  are  furnished  by  i 
electricity,   90,655   by    steam,   1939    by    gas,   and    476    by ; 
naphtha.  | 

Among  those  industries  which  are  still  in  a  state  ofll 
infancy  we  must  mention  the  chemical  industry;  this  is  | 
limited  to  a  few  candle  and  soap  factories,  sulphuric  and  | 
nitric-acid  works,  scent  distilleries,  dye  factories,  etc.,  whose  | 
produce  is  insufficient  to  the  needs  of  the  country.  ■ 

The  match  factories,  on  the  other  hand,  furnish  a  good  > 
article  and  are  sufficient  to  the  country.  The  consumption  j 
at  present  exceeds  200  million  boxes  per  annum. 

We  must  also  mention  the  existence  of  a  few  paper-mills,  i 
glass  furnaces,  and  various  works  where  certain  agricultural  * 
necessities  are  produced :  such  as  iron  wire,  fencing,  etc.,  and  J 
also  certain  wheel  factories ;  but  here  again  importation : 
furnishes  a  great  proportion  of  the  articles  consumed.  ; 


l!S&-b' 


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him 
Rod; 


1  EE 

iipori: 


CHAPTER  IV 

BANKS.   THE   BOURSE   OR  STOCK    EXCHANGE,   AND 
LIMITED   COMPANIES 

Banks — International  character  of  Argentine  banking — Evolution  of  banking 
machinery — List  of  the  principal  banks,  with  amount  of  capital  and 
business  done — Conditions  peculiar  to  Argentine  banking ;  the  lack  of 
moveable  reserves — Rates  of  interest  on  account,  on  deposit,  and  on 
advances — Statistics  of  the  deposit  accounts  of  the  principal  banks — 
Exchange  operations  :  their  decrease  since  the  determination  of  a  fixed 
monetary  ratio— The  Clearing  House  ;  the  importance  of  its  operations. 

The  Bank  of  the  Nation — Its  history — The  formation  of  its  capital — Political 
interference  in  the  nomination  of  its  Directors — Statistics  of  its  accounts 
— Rapid  increase  of  deposits— Difficulty  of  realising  capital — The  resump- 
tion of  payments. 

The  Bank  of  the  Province  of  Buenos  Ayres— Its  reorganisation — Its  present 
prosperity. 

Mortgage  and  Loan  Banks — History  of  the  Banque  ffypotMcaire  of  the  Province 
of  Buenos  Ajres — Bankruptcy — Arrangement  between  the  bank  and  its 
creditors — Proposal  of  reorganisation — Laws  relating  to  mortgage  in  the 
Argentine— The  National  Mortgage  Bank;  statistics  of  business  done — 
Joint-stock  loan  companies  ;  their  capital  and  amount  of  business  done. 

The  Stock  Exchange  (Bourse) — History  of  this  institution — Its  importance  ; 
its  functions  ;  amount  of  business  done — The  decrease  in  its  transactions 
since  the  cessation  of  speculation  in  currency  or  the  monetary  ratio. 

The  Bourse  is  a  private  estabhshment — Its  membership  and  its  regulations — 
Statistics  of  business  done  during  the  last  ten  years — Securities  quoted 
on  the  Buenos  Ayres  Bourse — Decrease  in  the  total  amount  of  business 
done  during  the  last  five  years — The  monetary  reform  of  1901  as  a  factor 
of  this  decrease — The  place  occupied  by  the  Stock  Exchange  in  the  life 
of  the  nation. 

Joint-stock  Companies — The  development  of  joint-stock  companies — Legis- 
lation affecting  such  companies — Abuses  committed  in  the  formation  of 
euch  companies,  due  to  speculation — Statistics  of  capital  invested  in  joint- 
stock  companies  before  and  after  the  speculative  crises  of  1890 — Revival 
of  such  companies,  in  a  sense  more  consistent  with  the  development  of  the 
country. 

IN  any  sketch  of  the  commercial  life  of  the  Argentine,  we 
must  include  the  Bourse  and  the  banks,  which  play  an 
important  part  in  the  business  life  of  the  community,  owing  to 
the  facilities  which  they  afford  to  all  kinds  of  commercial 
transactions. 

261 


262    THE  ARGENTINE  IN  THE  20th  CENTURY 

To-day  such  transactions  represent  a  considerable  figure, 
and  involve  a  movement  of  capital  amounting  to  scores  of 
millions.  There  is  obviously  need  of  an  organised  body 
designed  to  simplify  this  movement,  and  to  place  at  the 
disposal  of  trade  the  means  of  effecting  its  exchanges  with 
the  least  possible  displacement  of  capital. 

Banks. — It  was  inevitable  that  in  the  Argentine  the 
evolution  of  banking  should  be  towards  an  international 
character,  since  the  trade  of  the  Republic  is  almost 
entirely  with  foreign  countries.  Moreover,  this  trade  '  is 
very  largely  in  the  hands  of  foreigners:  French,  English, 
Germans,  Italians,  Spaniards,  Belgians,  or  Americans  from 
the  States;  which  fact  hns  resulted  in  the  formation,  in 
the  city  of  Buenos  Ayres,  of  various  groups  of  banks, 
corresponding,  in  respect  of  their  founders  or  their  capital, 
to  these  various  nationalities.  Each  of  these  establishments 
is  in  constant  communication  with  the  country  of  its 
origin,  and  seeks  to  gather  round  it  clients  of  its  own 
nationality. 

Both  in  the  matter  of  importance  and  that  of  organisa- 
tion the  banks  doing  business  in  the  Argentine  leave 
nothing  to  be  desired.  As  we  shall  presently  see,  the 
sum  of  the  capitals  of  all  these  banks  amounts  to  a 
total  of  nearly  £26,000,000 ;  a  sum  which  appears  to 
be  amply  sufficient  for  all  the  present  requirements  of 
trade. 

Working  under  a  system  of  free  competition,  and  hand- 
ling a  considerable  capital,  they  have  been  induced  to  offer 
greater  and  greater  facilities  to  trade,  in  order  to  increase 
the  number  of  their  clients  and  the  volume  of  their  opera- 
tions. Moreover,  the  suppression  of  the  gold  premium  has 
removed  one  of  their  chief  sources  of  profit;  so  that 
they  have  been  forced  to  obtain,  through  the  extension 
and  perfection  of  their  ordinary  banking  operations,  the 
compensatory  increase  of  business  which  allows  them 
to  maintain  the  volume  of  their  profits  and  their 
dividends. 

One  cannot  subject  these  banks  to  a  rigid  comparison ; 
each  of  them  conducts  its  business  for  the  benefit  of  clients 
of  its  own  nationality,  and  in  consequence  must  accede  to 


BANKS  AND  LIMITED  COMPANIES  2«3 

their  usages.  The  English  banks,  for  example,  have  as 
their  clients  railway  companies,  a  large  number  of  export 
houses,  and  steamship  lines,  on  account  of  the  ties  which 
connect  them  with  the  London  market  and  its  principal 
financial  groups.  The  German  Bank  principally  serves 
German  industrial  houses,  and  also  German  exportei-s.  The 
French  Bank  of  the  Rio  de  la  Plata,  owing  to  its  relations 
with  the  Paris  market,  and  its  strong  position  in  Buenos 
Ayres,  is  of  inestimable  service  to  French  commerce  in  the 
Argentine.  The  Italian  banks  share  the  custom  of  the 
Italian  colony,  which,  on  account  of  its  numerical  importance, 
crives  rise  to  a  great  deal  of  small  business. 

The  Banco  Espanol  del  Rio  de  La  Plata,  which  has 
branch  establishments  in  Paris,  London,  Genoa,  and  Madrid, 
is  in  direct  relation  with  the  financial  circles  of  those  cities, 
and  facilitates  all  banking  operations  between  the  various 
Spanish-speaking  countries.  Founded  by  the  financiers  of 
Buenos  Ayres.  and  afterwards  enlarged  by  French  capital, 
the  Spanish  bank,  which  has  admirable  premises,  has 
succeeded  in  surrounding  itself  with  a  clientele  of  great 
landed  proprietors,  by  off'ering  them  all  kinds  of  facilities 
for  the  conduct  of  business  operations  connected  with  the 
sale  of  national  produce.  Their  branch  establishment  in 
Paris  is  the  favourite  bank  of  the  numerous  Argentines  who 
go  yearly  to  Europe  on  business  or  for  pleasure. 

In  this  congeries  of  banks  the  Argentine  is  represented 
by  two  great  establishments :  one  of  these,  the  Banco  de  la 
Nacion  Argentina,  is  a  State  institution  which,  in  addition 
to  the  business  transacted  with  the  Government,  runs  cash 
and  deposit  departments  like  other  banks ;  the  other  is  the 
Banco  de  la  Provincia  de  Buenos  Ayres.  whose  origin  was 
in  the  reconstruction  of  the  historic  bank  of  the  same  name, 
the  collapse  of  which  was  provoked  by  the  terrible  financial 
crisis  of  1890.  The  excellent  results  of  the  last  three  years, 
which  we  shall  presently  consider  in  detail,  allow  us  to 
predict  a  brilliant  future  for  this  institution. 

We  shall  give,  in  the  following  table,  a  list  of  these 
banks,  in  the  order  of  their  establishment,  with  details  as 
to  their  capital,  reserves,  transactions,  and  dividends. 

As  lately  as  the  year  1907,  it  was  extremely  diflficult  to 


264    THE  ARGENTINE  IN  THE  20th  CENTURY 

obtain  exact  information  as  to  the  operations  of  financial 
establishments,  as  there  was  no  law  obliging  them  to  publish 
periodical  statements  of  their  position.  From  this  state  of 
afiairs  resulted  this  curious  fact :  that  if  one  wished  to 
ascertain  the  situation  or  study  the  operations  of  the  English 
banks,  for  example — establishments  which  effected  their 
business  transactions  by  the  aid  of  funds  deposited  by 
inhabitants  of  the  Argentine — one  was  forced  to  resort  to 
the  records  of  the  London  Stock  Exchange,  in  order  to 
examine  the  reports  and  balance-sheets  presented  each  year 
by  the  administrative  Boards  to  the  shareholders  residing 
in  England.  But,  very  fortunatelj?-,  thanks  to  a  decision 
of  the  ex-Minister  of  Finance,  Dr  Eleodoro  Lobos,  this 
omission  has  been  remedied,  and  it  has  been  decreed  that 
all  financial  establishments  must  in  future  supply  the 
Ministry  of  Finance,  during  the  first  days  of  each  month, 
with  an  explanatory  balance-sheet  giving  details  of  their 
transactions.  This  information  is  made  public,  so  that  not 
only  the  Government,  but  anyone  devoting  himself  to  the 
study  of  commercial  or  financial  aflfairs,  may  obtain  an  exact  i 
knowledge  of  the  situation  of  the  leading  banks,  and  thence 
of  the  market,  or  indeed  of  the  country  in  general. 

All  these  banks  work  with  a  relatively  large  capital, 
which  is  mostly  deposited.  To  understand  the  situation  we 
must  remember  that  banks  are  obliged,  in  the  Argentine, 
to  keep  going  by  their  own  means,  and  are  not  allowed  the 
resource  of  mobilising  their  turnover  by  rediscounting  at 
the  Bank  of  the  Nation.  The  latter,  indeed,  is  rather  a 
competitor  than  a  prop ;  since  it  also  seeks  the  custom  of 
private  clients.  Thus  the  funds  at  the  disposal  of  the  banks 
consists  of  their  own  capital  and  their  deposit  accounts — 
these  latter  varying  greatly  from  one  period  to  another — 
and  they  cannot  benefit  by  the  supplementary  force  arising 
from  a  credit  at  the  National  Bank, 

This  lack  of  fluidity  as  affecting  their  capital  is  doubly 
inconvenient ;  it  forces  the  banks  always  to  keep  their  cash 
reserves  at  a  high  level,  and  also  prevents  their  finding 
employment  for  their  deposited  funds — at  any  rate  in  the 
case  of  accounts  at  sight.  Without  this  faculty  of  rapid 
mobilisation   they   cannot   enlarge,   by  operations   of   short 


BANKS  AND  LIMITED  COMPANIES 


265 


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266    THE  ARGENTINE  IN  THE  20th  CENTURY 

duration,  the  sums  which  they  receive  in  deposit,  and 
consequently  cannot  allow  any  appreciable  interest  on  that 
portion  of  their  capital.  Some  banks  are  at  present  paying 
1  per  cent,  on  current  accounts ;  others,  and  notably  the 
National  Bank,  allow  their  depositors  no  interest.  For 
deposit  accounts  at  three  months  the  interest  is  usually 
3|  per  cent. 

As  for  the  rates  of  discount,  these  have  fallen  considerably 
in  the  last  few  years ;  partly  on  account  of  the  increasing 
competition  between  the  various  financial  groups,  and  partlyi 
on  account  of  the  abundance  of  capital  after  several  yearsl 
of  good  harvests.  After  standing  for  a  long  time  at  7i 
and  8  per  cent.,  the  average  rate  for  first  signatures  tends 
nowadays  to  settle  at  6  per  cent. 

This  is  a  fact  which  may  surprise  those  who  believe  that 
the  monetary  situation  of  a  country  is  always  afFected| 
by  the  premium  on  gold,  but  we  shall  see,  in  the  chapter 
on  finance,  that  there  is,  as  a  matter  of  fact,  an  influx 
of  gold  into  the  country,  and  that  its  movable  resources! 
have  never  been  more  abundant.  The  circulation  of  notes' 
is  now  guaranteed  by  a  cash  reserve  of  more  than  65  per 
cent. 

The  banks  receive  deposits  at  sight,  at  thirty,  sixty,: 
ninety,  and  one  hundred  and  eighty  days.  They  also' 
receive  deposits  on  the  "savings-bank"  system:  that  is, 
they  pay  3^  or  4  per  cent,  upon  deposits  not  exceed-! 
ing  5000  to  10,000  piastres  in  paper  money,  or  3000' 
to  5000  in  gold  (according  to  the  particular  bank) — that  is,: 
£440  to  £880  in  notes,  £600  to  £1000  in  gold— on  condition 
that  if  the  money  is  withdrawn  under  sixty  days  no  interest; 
will  be  allowed.  After  the  lapse  of  sixty  days  the  money; 
may  be  withdrawn  at  the  will  of  the  depositor,  and  thai 
interest  is  added  since  the  day  of  deposit.  Small  savings^ 
deposited  on  this  system  attain  to  considerable  proportions,! 
and  the  public  is  becoming  more  and  more  familiarised  with! 
business  of  this  kind.  i 

One  item  that  differs  very  sensibly  from  European  usageij 
is  the  rate  of  interest  charged  on  current  debit  accounts.!' 
As  the  Argentine  has  no  law  regulating  this  rate,  there  have, 
been  times,  happily  now  past  by,  when  this  rate  has  been  asi| 


BANKS  AND  LIMITED  COMPANIES  267 

high  as  10  and  12  per  cent  Of  late  years  the  Govern- 
ment has  paid,  as  a  maximum,  6  to  7  per  cent,  and 
that  iu  moments  of  disequilibrium,  when  international 
complications  were  feared,  and  the  bank  rates  had  risen  in 
England  and  elsewhere. 

For  private  individuals  conditions  are  also  easier,  on 
account  of  competition,  and  7  per  ceut.  has  become  practically 
the  average  rate.  In  certain  banks  the  rate  on  debit 
accounts  has  even  fallen  as  low  as  6  per  cent. 

The  following  table  indicates  the  movements  of  the 
principal  accounts,  during  the  years  1906-1908,  in  the  case 
of  the  various  banks  which  publish  their  balance-sheets,  in 
the  Argentine. 

Ou  an  international  market   like  that  of   Buenos  Ayres 

exchange  operations   are   naturally  most   attractive.     Since 

.  the  suppression  of  the  gold  premium,  which  has  reduced  the 

risks  to  a  barely  sensible  amount,  these  operations  no  longer 

:  retain  their  old  speculative  character;  but,  on  the  other  hand, 

;  the  profits  to  be  drawn  from  operations  of  this  kind  have 

.  greatly   diminished,   so   that    business    has   gained   only   in 

safety   and    extent.      We    may   here    recall   the   fact    that 

speculations    in    gold,    which    amounted    to      1,234,000,000 

piastres  paper  (£108,592,000)  iu  the  year  1899,  had  fallen  to 

211,000  piastres  in  1904,  and  have  now  entirely  ceased. 

Moreover,  in  order  still  further  to  avoid  all  risks,  such 
;  business  is  now  done  by  means  of  cable  transfers,  instead  of 
I  by  cheques  at  one  month  from  date  as  formerly  ;  thus  avoid - 
,  iug  as  far  as  possible  any  variation  in  the  rate  of  exchange. 
I  It  is  chiefly  during  the  period  of  exportation  that  these 
)  drawing  transactions  become  of  great  importance. 
;  Exchange  business  is  transacted  on  a  gold  basis  ;  that  is, 
;  on  the  basis  of  the  gold  piastre,  which  is  equivalent  to  a 
I  dollar,  or  to  5  francs  of  French  money,  or  4s.  of  English ; 
I  as  for  settlements,  they  are  made  indifferently  in  gold  or 
i  paper,  on  the  basis  of  44  centavos,  or  -44  of  a  piastre  in  gold, 
for  one  piastre  in  paper. 

Formerly  the  rate  of  exchange  used  to  vary  very  per- 

i  ceptibly  with  the  seasons.     The  banks  used  to  buy  during 

'  the   export   season,    which   for   grain   and  wool    lasts    from 

December    to    March,    and    consequently    profited    by    the 


268     THE  ARGEKTINE  IN  THE  20th  CENTURY 


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BANKS  AND  LIMITED  COMPANIES  269 

abundance  of  the  market  to  discuss  the  price.  They  then 
sold  to  import  houses  during  the  slack  season,  sometimes 
making  a  profit  of  6  to  10  centimes.  Now  competition  has 
greatly  reduced  these  margins,  which  scarcely  vary  at  all, 
in  a  normal  season,  except  to  the  extent  of  an  insignificant 
fraction. 

Again,  the  sales  of  money  are  now  extended  over  a  far 
longer  period  than  before,  as  the  export  season  itself  has 
been  extended  by  new  products,  such  as  maize,  chilled  and 
frozen  meats,  etc.,  which  do  not  necessarily  find  their  outlet 
at  the  same  time  as  the  rest  of  the  harvest.  Thus  the  bunks 
have  no  longer  any  incentive  to  hoard  reserves  of  money, 
as  they  are  no  longer  certain  of  selling  them  a  few  months 
later. 

All  these  conditions  here  enumerated  are  of  course  subject 
to  certain  small  variations,  according  to  the  kind  of  trade  or 
industry.  The  large  landowner,  the  grazier,  the  farmer,  the 
cattle-breeder,  who  has  no  money  at  his  disposal  but  that 
coming  from  the  sale  of  his  products,  can  only  procure  credit, 
no  matter  what  his  wealth  may  be  in  land,  at  a  rate  far 
higher  than  that  which  is  demanded  of  the  large  commercial 
houses  of  Buenos  Ayres.  But  as  we  have  especially 
attempted  to  demonstrate,  the  Argentine  banks  are  to-day 
splendidly  equipped  with  capital,  so  organised  as  to  assist 
commerce  by  services  of  many  kinds,  and,  finally,  their 
-  charges  have  been  abated,  by  the  action  of  competition,  to 
rates  which  one  would  hardly  expect  to  find  in  practice  in  a 
new  country.* 

As  the  latest  sign  of  progress  we  may  mention  the 
establishment  of  the  Clearing-House,  which  commenced 
operations  in  1893,  upon  the  model  of  the  London  Clearing- 
House,  under  the  able  management  of  the  under-manager 
of  the  Bank  of  London  and  the  Rio  de  la  Plata,  Mr  Hogg. 
This  institution,  as  its  name  indicates,  serves  to  strike  the 
balances  of  the  sums  which  the  various  banks  may  owe  one 
another,  the  balances  only  being  actually  paid  over.  The 
total  sum  represented  by  the  operations  of  the  Clearing- 
House  in  190S  was  over  £352,000,000.     This  figure  includes 

*The    depoBitB   in   the    Argentine    banks    at    present    amount  to    nearly 
jC80,000,000. 
S 


270    THE  ARGENTINE  IN  THE  20th  CENTURY 

the  transactions  of  the  principal  banks  of  Buenos  Ayres,  with 
the  exception  of  the  National  Bank,  which  does  not  make 
use  of  the  Clearing-House. 

Between  1893  and  1899  the  business  done  at  the  Clearing- 
House  underwent  a  notable  and  continual  increase,  and  in 
1899  amounted  to  more  than  £350,000,000.     Since  that  time 
its  operations  temporarily  decreased  in  value,  owing  to  the 
suppression   of    the   gold   premium,   which   put   an   end   to 
exchange  speculations,  which  formerly  kept  the   Clearing-    , 
House  busy;  so  that  in  1903  and  1904  the  total  amount  of   i 
the  operations  was  barely  £264,000.     Since  1904,  however,   I 
these  figures  have  gradually  increased,  and  in  1907  and  1908    i 
they  once  more  exceeded  £350,000,000.     To-day  the  business   I 
is  purely  commercial,  rendering  any  exact  comparison  with   ,' 
the  times  when  speculation  played  the  principal  part  extremely   : 
difficult.     But  if   we  could  subtract  this  latter   element  we   j 
should    certainly    find    that    the    compensations    based    on   i 
commercial    operations    have    greatly    increased,   since    the  ] 
figures  of  1899,  although  less  by  those  representing  specula-   ! 
tive  transactions,  have  not  appreciably  diminished.  i 

The  Bank  of  the  Nation. — To  complete  this  account  of  j 
the  banks  of  Buenos  Ayres  and  their  operations,  we  must  i 
give  an  account  of  the  working  of  the  most  important  of  ! 
them  all :  the  Banco  del  Nacion.  This  bank  is  of  especial  ] 
interest,  on  account  of  its  relations  with  the  Argentine 
Government,  which  guarantees  all  its  liabilities. 

The  Bank  of  the  Nation  came  to  birth  at  an  extremely 
critical  moment  in  the  history  of  Argentine  credit  and 
finance.  In  1890,  after  the  double  political  and  financial 
crisis  which  was  then  afi'ecting  the  country,  as  a  consequence 
of  the  errors  and  abuses  committed  by  the  Governments, 
at  a  time  when  all  the  official  credit  establishments  in  the 
country  lay  moribund,  disorganised,  and  discredited,  the  \\ 
Government  of  Signor  Pellegrini,  called  in  to  inherit  the  i! 
confusion  of  that  which  had  just  fallen,  found  itself 
faced  with  terrific  problems.  It  attempted  to  solve  the 
banking  problem  by  founding  a  new  institution,  to  which 
it  assigned  a  capital  of  50,000,000  of  piastres— £4,400,000— 
the  shares  to  be  offered  for  public  subscription.  To  the 
subscribers    it    promised    a    certain    intervention    in     the 


BANKS  AND  LIMITED  COMPANIES  271 

administration  of  the  bank,  at  the  same  time  reserving  to 
the  State  the  right  of  appointing  the  president,  just  as  the 
French  Government  appoints  the  president  of  the  Bank  of 
France.  In  order  as  far  as  possible  to  guarantee  the  share- 
holders and  the  public  against  the  errors  and  abuses  which 
had  formerly  been  so  disastrous,  it  established  certain  restric- 
tive rules  in  the  charter  of  the  new  establishment. 

At  another  time  there  was  much  discussion  as  to  whether 
the  Government  of  Signor  Pellegrini,  whose  patriotic  inten- 
tions no  one  doubted,  would  not  have  done  better  to  rescue 
the  old  National  Bank,  which  was  tottering  amid  the  ruins 
of  the  crisis,  and  whose  assets,  administered  by  the  new  institu- 
tion, might  have  given  better  results  than  did  liquidation, 
thus  saving  the  State  much  expense ;  but  this  question  is  no 
longer  of  immediate  interest. 

As  was  only  to  be  feared,  the  public,  after  the  spectacle 
of  such  striking  examples  of  the  lamentable  end  to  which 
official  banks  are  liable  in  countries  formed  by  the  chances 
of  immigration,  and  devoid  of  established  traditions  :  wherein 
there  exists  no  sanction  for  the  suppression  of  undoubted 
abuses :  the  public,  we  shall  see,  regarded  the  new  institution 
with  mistrust,  and  abstained  from  buying  shares.  The 
Government,  disappointed  in  its  attempt,  was  compelled 
to  replace  the  system  of  public  subscription  by  an  issue  of 
notes,  which  explains  why  a  purely  official  bank  was  created, 
instead  of  the  mixed  bank  which  had  been  proposed. 

Realising  that  the  success  of  a  bank  depends  far  more 
upon  the  confidence  with  which  it  inspires  the  public  than 
upon  its  organic  charter,  Signor  Pellegrini's  Government, 
together  with  those  that  followed  it,  took  care  to  place  at 
the  head  of  the  Banco  del  Nacion  only  men  who  were 
capable,  by  their  good  judgment,  their  technical  competence 
in  banking  business,  their  social  position,  and  their  knowledge 
of  the  business  world,  of  giving  prestige  to  the  establish- 
ment, and  surrounding  it  with  the  atmosphere  of  respect 
and  confidence  which  was  necessary  to  its  success.  Thus  in 
spite  of  its  official  origin  the  bank  was  able  to  find  support 
in  public  opinion,  and  to  render  important  services  to  industry 
and  commerce. 

A  study  of  the  accounts  of  this  establishment,  during  the 


II 


272    THE  ARGENTINE  IN  THE  20th  CENTURY 

years  1904-1908,  reveals  u  steady  and  prosperous  progress, 
which  has  incontestably  placed  the  Bank  of  the  Nation  at 
the  head  of  all  similar  institutions. 

A  glance  at  the  following  table  will  prove  this.  It 
contains  the  balances  of  the  three  principal  accounts,  upon 
the  31st  of  December  of  the  five  years  from  1904  to  1908 
inclusive. 


Year. 

Bills  in  Hand. 

Uveraratts  in 
Current  Accounts. 

Deposits. 

1904      ... 

...      £8,486,326 

£14,384 

£12,561,969 

1905      ... 

...       11,842,611 

2,589,167 

15,501,340 

190G      ... 

...       13,364,585 

1,907,818 

15,163,974 

1907      ... 

...      16,502,621 

2,731,314 

18,008,501 

1908      ... 

...      19,049,708 

2,897,008 

20,713,375 

We  see  from  these  figures  that  in  five  years  the  business 
done  has  increased  by  more  than  10|  millions  of  pounds;  the 
overdrafts  in  current  accounts  by  nearly  £300,000  (in  four 
years,  1905-1908),  and  the  deposits  by  more  than  £8,000,000. 

The  Bank  of  the  Nation  has  one  hundred  and  ten  branch 
establishments  scattered  all  over  the  Argentine,  and  their 
number  is  continually  increasing.  Here  are  the  figures 
relating  to  the  three  principal  accounts  in  these  branch 
establishments  during  the  same  period  : — 


Year. 

Bills  in  Hand. 

Overdrafts  on 
Current  Accounts. 

Deposits. 

1904 

£5,111,481 

£3,744 

£5,187,982 

1905 

6,987,847 

349,427 

6,842,559 

1906 

8,557,900 

.570,350 

7,707,001 

1907 

9,848,713 

860,899 

8,433,003 

1908 

11,196,690 

744,119 

10,210,650 

We  find  here,  among  the  branch  establishments,  an  in- 
crease of  over  £6,000,000  in  the  bills  in  hand ;  nearly 
£740,000  in  the  overdrafts  on  current  accounts;  and  over 
£5,000,000  on  the  deposits. 

These  exceedingly  satisfactory  results  have  been  obtained 
by  the  National  Bank  by  means  of  a  nominal  capital  of 
£9,680,000.  We  use  the  phrase  "nominal  capital"  with 
intention,  for  although  this  sum  figures  on  the  balance-sheets 
of  the  bank,  we  must  remember  that  in  this  capital  are 
included  State  bonds,  which  would  have  furnished,  had  they 
been  negotiated,  an  available  sum  of  £3,212,000  in  paper- 
money,  and  tliat  the  net  profits  of   the  year  1908  are  also 


BANKS  AND  LIMITED  COMPANIES  273 

included,  amounting  to  £644,036  in  paper,  which  by  law 
must  go  to  increase  the  "  Capital  and  Reserve  Funds."  The 
two  accounts,  after  the  deduction  of  the  sums  accruing  to 
them  as  profit,  amount  respectively  to  £9,697,946  in  paper- 
money  and  £1,303,248  in  gold.  It  follow's  from  this  that  if 
the  Banco  del  Nacion,  instead  of  being  an  official  institution, 
were  an  ordinary  bank,  it  would  have  been  able  to  pay  its 
shareholders  a  dividend  of  10  per  cent,  upon  its  paid-up 
shares. 

The  data  we  have  just  given  prove  abundantly  that  the 
Bank  of  the  Nation  has  been  directed  by  a  hand  as  firm  as 
it  is  prudent,  and  there  is  every  reason  to  suppose  that  it 
will  continue  in  the  future  to  serve  public  and  private 
interests  as  well  as  it  does  to-day.  The  forecast  we  pre- 
dicted in  the  first  edition  of  this  book  will  have  proved  mis- 
taken ;  a  forecast  based  upon  the  authoritative  opinion  of 
an  eminent  Argentine  statesman,  who  affirmed  that  the 
official  banks  "  bore  within  them  the  germs  of  the  moral  and 
financial  ruin  of  the  country."  He  even  added  that  one 
should  never  "  incorporate  a  bank  with  the  political  adminis- 
tration of  a  State,  because  sooner  or  later  it  will  be  used  as 
a  political  weapon." 

We  must  here  pay  our  respects  to  the  memory  of  Dr 
Ramon  Santamarina,  a  former  president  of  the  Administra- 
tive Council  of  this  establishment,  whose  premature  death 
was  a  great  loss  to  the  bank  and  to  the  country.  It  is, 
indeed,  to  his  intelligent  and  circumspect  management  of 
affairs  that  we  owe  a  great  measure  of  the  happy  results 
obtained. 

The  Bank  of  the  Province  of  Buenos  Ayres. — There  is  in 
the  Argentine  another  important  financial  house  :  the  Banco 
de  la  Provincia  de  Buenos-Aires,  which  has  lately  re-arisen 
from  its  ashes,  by  the  aid  of  the  Banco  del  Comercio  His- 
j^ano- Americano.  This  also  was  a  victim  of  all  kinds  of 
abuses,  committed  to  its  detriment,  by  the  administrations 
which  successively  directed  it. 

The  bank  was  reorganised  in  June  1906,  with  a  capital 
of  £1,760,000,  of  which  sum  half  was  furnished  by  the 
Government  of  the  Province  and  half  by  the  shareholders, 
with  the  proviso  that  this   capital   might   be   increased    to 


274    THE  ARGENTINE  IN  THE  20th  CENTURY 

£4,400,000,  which  was  done  at  the  end  of  1908.  According 
to  the  business  done  by  this  bank  from  1906  up  to  the 
present  time,  we  may  predict  for  it  a  great  future,  provided 
that  its  presidents,  learning  from  the  past,  guard  it  resolutely 
from  the  influence  of  political  struggles  and  the  demoralising 
factions  from  which  it  has  suffered  in  the  past.  The  new 
establishment  enjoys  all  the  prerogatives,  exemptions  and 
privileges  which  were  accorded  to  the  old  bank  ;  it  is  the 
obligatory  receptacle  in  which  are  deposited,  gratuitously, 
the  funds  of  the  provincial  administrations  and  the  courts. 

The  most  delicate  point  in  this  conjunction,  namely,  the 
manner  in  which  the  administration  of  the  bank  should  be 
conducted,  has  been  so  determined  as  to  assure  the  pre- 
ponderance of  the  private  interests  of  the  shareholders  of 
the  bank  over  the  official  interests  of  the  Government.  The 
administration  of  the  bank  is  confided  to  a  council,  composed 
of  a  president  appointed  by  the  Government  of  the  Province 
of  Buenos  Ayres,  and  twelve  directors,  four  of  whom  are 
nominated  by  the  Government  and  eight  by  the  private 
shareholders ;  an  arrangement  which  constitutes  an  excellent 
guarantee  of  proper  management. 

From  the  balance-sheets  of  the  last  three  years,  and  the 
figures  contained  in  the  reports  of  the  directing  board,  or 
Council  of  Administration,  we  may  judge  the  activity  dis- 
played by  this  bank,  and  the  progress  realised  since  its 
re-establishment. 

Here,  for  example,  are  the  amounts  of  the  deposit 
accounts  as  taken  upon  the  31st  of  December  of  each  year, 
from  190(i  to  1908  inclusive,  as  well  as  the  bills  in  hand  and 
the  overdrafts  on  current  accounts. 


Deposits. 

Bills 

Overdrafts  on 

Year. 

Paper.*                    Gold. 

in  Hand. 

Current  Accounts. 

1906 

£4,610,309          .£179,431 

£3.419,809 

£467,342 

1907 

4,920,561            396,108 

3,953,903 

665,670 

1908 

5,716,441            409,690 

4,785,044 

477,310 

The  extensive  business  done  by  this  bank,  which  is 
evident  from  the  preceding  figures,  has  produced  consider- 
able profits,  which  amounted  to  £109,298  in  1906;  £220,551 
in  1907  ;  and  £246,884  in  1908. 

*  Actual  value  in  gold. 


BANKS  AND  LIMITED  COMPANIES  275 

In  the  latter  year  the  net  profits  readied  an  average  of 
14<'02  per  cent,  of  the  total  capital.  This  flourishing  state  of 
affairs  allowed  of  the  payment  to  the  shareholders  of  a  dividend 
of  9'5  per  cent,  in  1907  and  10  per  cent,  in  1908,  without 
prejudice  to  the  reserve  funds,  which  amount  to  £73,920. 

Money-lending  or  Mortgage  Banks  (Banques  Uypothe- 
caires).  There  are  two  great  official  institutions  of  this 
kind  in  the  Argentine :  the  Mortgage  Bank  National  is 
progressing  in  a  normal  manner;  the  other,  the  Mortgage 
Bank  of  the  Province  of  Buenos  Ayres,  is  painfully  achieving 
the  process  of  liquidation. 

We  must  explain  that  this  institution,  which  worked 
for  a  number  of  years  with  average  regularity,  collapsed 
violently  in  1890,  on  account  of  the  scandalous  abuses 
committed  by  the  management  in  the  matter  of  loans,  and 
the  pernicious  introduction  of  electoral  politics  into  the 
conduct  of  business.  This  is  one  of  the  most  lamentable 
pages  of  the  administrative  and  financial  history  of  the 
Argentine  during  the  last  few  years. 

After  numerous  efforts  had  been  made  at  various  times 
with  a  view  to  making  an  arrangement  between  the  bank 
and  its  creditors  by  means  of  an  exchange  of  its  bonds  of 
mortgage  for  new  bonds  of  the  Rente  Provinciate,  a 
satisfactory  agreement  was  at  length  arranged,  which  put 
an  end  to  the  irregular  situation  of  the  bank,  in  a  manner 
as  advantageous  for  the  creditors  as  for  the  Province. 

According  to  the  report  drawn  up  by  the  representative  of 
the  Government,  the  liabilities  of  the  bank  amounted,  on 
30th  June  1906,  to  £19,725,636;  and  to  set  against  this 
colossal  debt  the  bank  possessed  the  assets,  largely  precarious, 
represented  by  503  loans  on  mortgage,  of  which  the  principal 
amounted  to  £1,967,704,  while  unpaid  or  overdue  interest 
accounted  for  £6,568,440  ;  or  a  nominal  total  of  £8,536,140. 

The  assets  also  comprised  certain  other  items,  amounting 
to  a  total  of  £2,186,184. 

Some  of  these  assets  had  a  real  value  and  could  be 
considered  as  capable  of  realisation.  Among  these  were : 
the  money  in  the  bank,  the  bank  premises,  the  mortgages, 
and  the  special  accounts  with  the  Provincial  Government; 
these   items  constituted   the   best  class  of   assets.     The  re- 


276    THE  ARGENTINE  IN  THE  20th  CENTURY 

maining  assets  were  more  precarious,  and  their  investigation 
gave  rise  to  serious  criticisms. 

Two  classes  of  assets,  for  example,  which  were  apparently 
of  considerable  importance — those  relating  to  hypothecary 
credit  and  to  personal  shares — were  far  from  representing 
the  value  which  was  shown  on  the  balance-sheet. 

Taking  into  account  the  probabilities  of  the  realisation 
of  certain  classes  of  assets,  in  case  of  need,  a  liability  of 
£19,725,636  was  opposed  by  assets  equivalent  to  £6,242,039, 
leaving  a  deficit  of  £13,583,595.  In  other  words,  the  assets 
represented  only  31  per  cent,  of  the  liabilities. 

The  Government's  representative,  having  analysed  the 
effective  revenue  at  the  disposal  of  the  Province,  and  allowing 
for  the  probable  progress  by  which  it  might  benefit  in  the 
immediate  future,  declared  that  the  Public  Treasury  could 
not  put  aside  more  than  £308,000  for  the  purpose  of 
guaranteeing  the  dividends  on  the  shares  of  the  Bank ;  but 
that  this  sum  would  probably  be  increased  by  £44,000  during 
the  next  five  years,  and  by  £48,400  at  the  end  of  ten  years ; 
thus  assuring  the  creditors  of  an  interest  of  3|  per  cent., 
and  a  proportional  amortisation  of  |  per  cent.  An  arrange- 
ment on  this  basis  was  proposed  to  the  creditors  of  the 
Bank  at  a  general  meeting,  held  at  la  Plata  in  November 
1906,  and  was  accepted. 

We  must  add  that  at  the  present  time  the  Provincial 
Government  is  considering  a  scheme  designed  to  infuse  new 
life  into  the  Mortgage  Bank.  This  system  consists  of 
founding  a  limited  company  in  which  both  public  and 
private  interests  would  be  represented ;  a  state  of  afiairs 
very  like  that  already  in  existence,  and  yielding  excellent 
results,  in  the  case  of  the  Bank  of  the  Province  of  Buenos 
Ayres. 

The  great  ofiicial  establishment  for  loans  on  mortgage  in 
the  Argentine  is  the  Banco  Hipotecario  Nacional.  This 
bank  grants  loans  upon  real  estate  in  the  capital,  provinces, 
and  national  territories.  It  issues  cedulas  which  bear  an 
interest  of  5  to  6  per  cent.,  with  an  amortisation 
rate  of  1  to  4  per  cent.,  which  are  quoted  at  about 
par  on  the  market,  so  that  the  holder,  after  the  deduction 
of  expenses  and  commissions,  obtains  a  satisfactory  interest. 


BANKS  AND  LIMITED  COMPANIES  277 

The  value  of  cednlas  in  circulation  at  the  end  of  1908 
amounted  to  £11,871,108  in  paper  (actual  value)  and 
£1,876,530  in  gold,  respectively. 

In  addition  to  these  official  establishments,  there  are 
various  private  companies,  founded  by  means  of  foreign 
capital,  which  issue  loans  on  real  estate  in  the  capital  of 
the  Republic  and  on  land  in  some  of  the  Provinces. 

According  to  our  information,  these  companies 
employ  a  capital  of  nearly  £15,000,000,  divided  as 
follows : 

Argentine  Railway  Loan  Co.,  Ltd £827,600 

River  Plate  Trust  Loan  and  Agency  Co.           2,705,422 

SociettI  de  Credit  Foncier  de  Santa  Fe 511,120 

Mortgage  Co.  of  the  River  Plate            1,907,717 

River  Plate  and  Gal.  Investment  Trust  Co 501,000 

Dutch  Mortgage  Trust  of  the  Rio  de  la  Plata 286,1!»4 

Argentine  Mortgage  and  Agricultural  Co.       ...         ...  80,000 

The  Standard         541,488 

Credit  Foncier  Argentine            3,016,340 

Compagnie  Pastorale  Beige  Sud.-Americaine 1.350,102 

Societe  Hypothecaire  Beige-Argentine             ...         ...  1,583,130 

Banque  Hypothecaire  Franco-. Vrgentinc         ...         ...  1,487,160 

Societe  Rurale  de  Bahia  Blanca             ...         ...         ...  3,960 


£14,894,233 


High  as  these  figures  are,  however,  they  represent  only 
a  portion  of  the  foreign  capital  employed  in  this  class  of 
transactions,  for  considerable  sums  are  advanced  by  private 
persons  who  wish  to  obtain  the  high  interest  obtainable. 

These  companies  lend  only  gold,  that  they  may  escape 
the  fluctuations  of  the  paper-money  market,  and  usually 
limit  their  operations  to  dealing  with  properties  in  the 
capital  or  in  the  Province  of  Buenos  Ayres,  doing  business 
with  the  rest  of  the  country  only  in  a  very  limited  degree. 
Although  Argentine  legislation  is  extremely  advanced  in  the 
matter  of  loans  and  mortgages,  the  lender  fears,  in  the  case 
of  certain  provinces,  to  encounter  diiEculties  in  practice,  or 
delays  of  legal  procedure  in  the  case  of  foreclosing.  The 
interest  on  mortgages,  which  during  the  year  1908  was 
maintained  at  about  9  per  cent.,  is  to-day  showing  a  tendency 
to  fall,  on  account  of  the  abundance  of  money  in  the  Buenos 
Ayres  market ;  the  rate  is  now  as  low  as  8  per  cent. 


278    THE  ARGENTINE  IN  THE  20th  CENTURY 

It  is  in  the  capital  of  the  Argentine  that  mortgage  opera- 
tions are  most  active.     During  the    decade    1889-1908    the 
amount  of  loans  upon  property  reached  the  sum  of  £37,241,000. 
This  amount  was  lent  upon  40,996  properties ;  and  of  this 
total   £7,603,000  was  lent   in  1908   alone.     The   mortgages 
effected  upon  rural  properties,  throughout  the  entire  Republic, 
for  the  years  1903  to  1907  inclusive,  amounted  to  £37,920,000,  , 
and  the  mortgaged  property  amounted  to  nearly  80,000,000  i 
acres.     In   this   total   the    Province    of   Buenos   Ayres   was  ^ 
represented  by  £16,880,000 ;  that  of  Santa  Fe  by  £3,240,000  ; 
that  of  Cordoba  by  £6,240,000. 

The  Argentine  Republic  possesses  one  of  the  most  perfect 
systems  of  mortgage  in  existence  among  modern  nations. 
To  prove  this  statement  we  need  only  explain  that  the 
Argentine  laws  do  not  recognise  secret  mortgages  ;  nor  do  they 
admit  any  privileges  in  favour  of  married  women  or  minors 
in  respect  of  special  mortgages.  Neither  does  such  a  thing 
exist  as  a  general  mortgage,  nor  are  there  any  privileges 
taking  precedence  over  the  right  of  the  mortgagee. 

The  mortgage,  like  every  action  which  affects  or  modifies 
the  right  of  the  proprietor  over  immovable  property,  must 
be  signed  before  a  notary  and  registered  by  the  Conservator 
of  Mortgages.  Before  drawing  up  the  deed,  the  notary 
must,  as  in  the  case  of  sales,  demand  a  certificate  stating 
whether  the  property  is  or  is  not  free  from  charges. 
Although  the  right  of  tlie  proprietor  is  perfect  as  to  posses- 
sion, the  law  tends  to  give  property  a  certain  degree  of 
mobility ;  thus  for  this  reason  the  term  of  a  sale  with  power 
of  redemption  is  three  years,  the  term  of  a  lease  ten  years, 
and  that  of  the  registration  of  a  mortgage  ten  years ;  but  all 
these  terras  may  be  renewed  upon  expiration.  The  term  of 
ten  years  in  the  case  of  mortgages  does  not  affect  the  Banco 
Hypotecario  Nacional,  nor  the  Bangue  Hypothecaire  de 
Buenos  Ayres,  nor  the  Banque  Hypothecaire  de  la  Capitale, 
in  virtue  of  the  special  laws  which  created  these  in- 
stitutions. 

The  Bourse  or  Exchange. — The  first  Commercial  Exchange 
or  Bourse,  or  let  us  rather  say  the  first  institution  to  fulfil 
the  functions  of  an  exchange  or  Bourse,  for  we  cannot  give 
that  name  to  the  market  which  formerly  existed  in  Buenos 


BANKS  AND  LIMITED  COMPANIES  279 

Ayres,  was  inaugurated  in  1810  under  the  name  of  the 
Chamber  of  Commerce — Sala  de  Comercio.  It  was  com- 
posed exclusively  of  members  of  the  English  colony, 
and  offered  them,  besides  the  usual  advantages  of  such 
establishments,  the  attraction  of  a  well-furnished  library. 

The  documents  available  do  not  tell  us  how  long  this 
institution  lasted,  nor  whether  at  a  later  period  it  opened  its 
doors  to  the  Argentine  element  nor  whether,  being  finally 
transformed,  it  served  as  a  basis  for  the  organisation  of  the 
exchange  as  it  is  to-day.  The  only  thing  certain  is  that  in 
July  1834  the  first  members  of  the  association  met  in  the 
Via  San  Martin,  there  to  establish  the  Bourse,  of  which 
the  inauguration  took  place  on  the  1st  of  December 
followiug. 

Before  this  date  there  was  a  financial  group  known  as 
the  "  Sociedad  Particular  de  Corredores,"  which  was  known  as 
the  Camuati,  and  which  busied  itself  with  mercantile  trans- 
actions. 

The  Bourse  retained  its  original  premises  until  the  year 
1862,  when  it  was  installed  in  another  building  in  the  same 
street,  at  present  occupied  by  the  Caisse  de  Conversion,  or 
Bank  of  Exchange. 

Some  years  later,  the  premises  being  too  small,  it  was 
proposed  to  build  other  and  far  larger  premises,  sufficient  to 
meet  the  ever-increasing  demands  of  the  institution.  In  1881 
an  extraordinary  general  meeting  was  held,  with  a  view  to 
forming  a  company  to  undertake  the  construction  of  premises 
to  house  the  "  Sociedad  Bolsa  de  Comercio."  But  the  corn- 
el pany  was  not  formed  until  1883,  when  it  acquired  the  site  on 
which  the  Bourse  now  stands ;  and  its  official  inauguration 
took  place  two  years  later. 

Since  then  the  Commercial  Exchange  has  enjoyed  a 
period  of  continued  prosperity ;  it  is  to-day  the  first 
commercial  centre  of  Latin  America.  It  exercises  a  great 
influence  over  the  commercial  and  economic  life  of  the 
Republic.  It  is  the  sole  establishment  of  its  kind,  having 
judicial  powers,  open  to  all  mercantile  transactions,  and 
establishing,  under  the  stress  of  supply  and  demand,  the 
prices  of  the  products  of  labour  or  commerce.  Having  the 
power  of  fixing  the  value  of  merchandise  by  quotations  of 


280    THE  ARGENTINE  IN  THE  20th  CENTURY 

paper-money,  it  is,  more  than  any  other  institution,  liable  to 
exceed  its  functions  ;  but  it  bears  within  itself,  in  its  admir 
able  organisation,  the  means  of   repairing  its  own  errors  \ 
and   of    remaining   the    faithful    regulator    of    prices    and 
values. 

The  most  eloquent  commentary  upon  the  importance  of 
the  operations  effected  by  the  Bourse  de  Commerce  is  the 
simple  enumeration  of  their  value  at  various  periods,  for  we 
then  realise  the  enormous  development  which  they  have 
achieved  in  a  period  relatively  short.  In  1886  the  total  of 
the  business  done  was  |1 73,000,000  paper,  £34,600,000  face 
value ;  in  1887  it  was  $254,000,000  (£50,800,000) ;  in  1888 
$432,000,000  (£86,400,000) ;  in  1889 $469,000,000 (£93,800,000). 
The  total  value  of  all  business  effected,  liquidated  or  not, 
cash  or  credit,  during  the  years  1890  and  1891,  amounted 
to  $18,000,000,000  (£1,584,000,000)  and  $7,000,000,000  li 
(£616,000,000),  respectively.* 

These  figures,  in  their  simplicity,  cover  the  history  of  an 
interesting  period  of  the  financial  life  of  the  country.  The 
wave  of  speculation  which  turned  all  men's  heads  began  to 
rise  as  early  as  1887,  and  in  1891  was  at  its  greatest  height; 
it  then  crumbled  into  foam,  having  shattered  the  most  deeply- 
rooted  of  banking  houses,  compromised  the  national  credit, 
changed  brilliant  illusions  into  melancholy  realities,  and  sown 
desolation  and  ruin  in  many  a  home.  After  the  catastrophe 
the  total  value  of  business  done  rapidlyjfell,  and  we  see  it 
falling  violently  from  one  year  to  another — from  the 
$18,000,000,000  of  1890  through  the  $3,376,000,000  of  1895, 
to  the  $835,000,000  of  1900;  a  year  which  experienced  a 
condition  of  affairs  which  was  destined  to  produce  a  beneficent 
influence  upon  the  economic  life  of  the  country.  •  \ 

In  this  total  of  $835,000,000  of  paper-money  we  find  that  1 1 
transactions  in  gold  amounted  to  $774,000,000  paper  money,  jjj 
corresponding  to  $66,800,000  of  gold  negotiated ;  while  in  1 1 
1899,  the  whole  business  done  in  the  Bourse  still  amounted  ' 
to  the  respectable  sum  of  $1,295,000,000  paper,  of  which 
$1,234,000,000   represented   operations   in   gold.     From   one 

*  The  values  before  1900  are  face  values,  as  the  actual  value  of  the  piastre 
note  fluctuated.     They  must  not  be  taken  as  actual  values  any,  more  than  in       , 
the  case  of  Indian  rupees. — [Trans.]  ii 


m 


BANKS  AND  LIMITED  COMPANIES  281 

year  to  another  the  total  sum  of  the  business  transacted  in 
the  Bourse  had  diminished  by  |460,000,000  (paper). 

The  principal  cause  of  this  notable  decrease  was  the  "  law 
of  monetary  conversion." 

This  law,  which  has  been  in  force  since  1890,  fixed  the 
value  of  44  centavos,  or  |-44  gold,  for  the  future  conversion 
of  paper-money,  and  enacted  that  the  Caisse  de  Conversion 
should  receive  the  gold  and  deliver  paper,  and  vice  versa,  at 
this  same  rate:  a  rate  equivalent  to  227*27  per  cent.  The 
effect  of  this  reform  was  thus,  if  not  to  destroy,  at  least  very 
largely  to  limit  unbridled  speculation,  which  made  itself 
especially  felt  in  the  value  of  the  paper  piastre. 

Speculation  in  gold  being  suppressed,  the  volume  of 
business  transacted  on  the  Bourse  de  Commerce  of  Buenos 
Ayres  grew  gradually  less  and  less,  falling  finally,  in  1904, 
to  $37,312,000  paper,  of  which  |19,968  stood  for  gold. 

After  1904  the  total  sum  of  these  operations  was  still 
further  reduced,  the  figures  for  1908  being  incredibly  low. 
Thus  the  total,  which  in  1905  had  attained  £45,400,000,  rose 
to  £57,800,000  in  1906,  fell  in  1907  to  £16,880,000,  and  in 
1908  to  £12,560,000.  To-day  the  activity  of  speculators  is 
concentrated  upon  operations  in  mortgage  bonds  and  the 
shares  of  various  companies ;  each  class  of  operations 
amounting  to  some  £5,000,000.  These  figures  show  that  the 
Bourse  de  Commerce  loses  from  day  to  day  some  part  of  its 
importance  as  the  regulating  centre  of  mercantile  transactions; 
but  it  would  be  an  error  to  measure  the  economic  vitality  of 
the  Republic  by  the  amount  of  business  efifected  on  the 
Bourse,  since  an  examination  of  the  situation  shows  us  that 
the  Argentine  has  never  known  a  period  of  more  obvious 
prosperity. 


Having  explained  the  new  phase  upon  which  the  Buenos 
Ayres  Bourse  has  entered,  we  must  now  consider  its  organisa- 
tion and  its  usages,  and  the  regulations  under  which  it 
operates. 

In  the  first  place  we  must  remark  that  the  Bourse  is  not 
an  official  institution,  but  a  private  establishment,  founded 
and  supported  by  a  limited  liability  company,  the  "Bolso  de 
^'      Comercio,"  which  is  recognised  as  a  judicial  body. 


282    THE  ARGENTINE  IN  THE  20th  CENTURY 

In  contrast  to  other  Exchanges,  and  that  of  New  York  in  j  ' 
particular,  the  number  of  shareholders  is  unlimited,  and  varies  .)  ^ 
from  time  to  time.  In  1886  there  were  2959;  in  1891,4901;  in  i  lio"' 
May  1905,  3709.  To  become  a  member  of  the  Bourse  one  must ' '  *"•' 
be  presented  by  two  shareholders,  admitted  by  the  Council 
Chamber  or  Committee  {Chambre  Syndicate),  and  must  pay 
a  moderate  entrance  fee,  as  well  as  an  annual  subscription. 

According  to  its  rules,  the  object  of  the  Bourse  de 
Commerce  is  to  "  offer  a  place  of  meeting  to  these  members, 
where  they  may  discuss  and  effect  all  manner  of  lawful 
business ;  and  to  facilitate  and  negotiate  all  commercial 
operations  by  giving  them  security  and  legality."  It  also 
undertakes  to  represent  commerce  and  production  in  general 
before  the  authorities  of  the  country,  or  before  private 
undertakings  ;  it  supports  petitions  relative  to  their  interests, 
in  order  that  laws  about  to  be  proposed,  or  those  which  are 
being  adopted,  shall  be  equitable  and  shall  favour  the  develop- 
ment of  commercial  transactions.  Its  object  is  both  to  ensure 
the  unity  of  commercial  usages,  and  in  case  of  need  to  take  the 
initiative  in  all  questions  of  economics  which  may  affect 
commerce  in  general. 

The  management  of  the  Bourse  is  effected  by  the  Council  ^ 
Chamber — the  Chambre  Syndical  de  la  Bourse,  which  is 
entrusted  with  the  general  and  official  representation  of  the 
institution.  It  is  this  authority  which  permits  or  refuses  the 
official  quotation  of  all  stocks,  shares,  loans,  etc.,  issued 
according  to  the  laws  of  the  country  of  their  origin  and  by  ;  j  t^ 
legally  constituted  bodies,  ' '  ij 

The  functions  of  the  stockbroker  can  only  be  fulfilled  \  «» 
by  persons  previously  authorised  by  the  Council  Chamber,  •;  18 
after  they  have  accomplished  certain  formalities,  and  have 
proved  whether  they  have  attained  their  legal  majority,  have 
experience  of  business,  and  have  enjoyed  a  good  reputation,  all 
of  which  must  be  guaranteed  by  three  men  of  business  of 
known  responsibility.  The  number  of  such  brokers  is  not 
limited,  and  may  be  increased  or  decreased  according  to 
circumstances.  In  1905,  for  instance,  their  number  was  385. 
They  are  not  obliged  to  give  security  nor  to  make  any 
deposit  as  guarantee  before  practising  ;  they  have  merely  to 
pay  a  small  monthly  subscription. 


BANKS  AND  LIMITED  COMPANIES  283 

The  regulations  of  the  Bourse  contain  severe  provisions 
against  brokers  who  infringe  any  of  the  numerous  prohibi- 
tions affecting  them ;  such  as  accepting  orders  from  clients 
whose  identity  has  not  been  proved ;  from  persons  known  to 
be  insolvent,  or  from  incapable  persons ;  or  acting  as  inter- 
mediary in  negotiations  where  there  is  reason  to  suspect  that 
the  parties  involved  are  not  proceeding  seriously.  Brokers 
who  infringe  these  rules  or  others — who  do  not,  for  example, 
meet  their  engagements — are  suspended  by  the  Council 
Chamber  of  the  Exchange. 

All  operations  must  be  declared  in  an  audible  voice  by 
the  stockbroker  to  the  recorder  (annotator),  in  order  that  the 
latter  may  inscribe  them  upon  the  blackboard.  The  vendor 
and  the  buyer  must  then  exchange  memoranda,  in  order  that 
the  transaction  shall  be  definitely  confirmed  and  made  valid. 
All  transactions  efiected  on  exchange  *  during  ofiicial  hours 
are  copied,  with  the  prices,  from  the  blackboard  into  the 
Journal  of  Sales ;  these  latter  being  also  published  in  the 
Boletin  de  la  Bolsa  de  Gomercio ;  or,  as  we  should  say,  the 
Stock  Exchange  Bulletin.  The  settlement  of  all  transactions 
concluded  is  effected  through  the  Council  Chamber,  with  the 
aid  of  the  Bureau  de  Liquidation,  or  Settlement  Oflfice,  under 
the  supervision  of  an  official  liquidator,  appointed  at  a  general 
meeting  of  the  brokers,  who  charges  a  percentage  on  the 
settlements  which  he  effects.! 

Such  are  the  principal  rules  of  the  organic  charter  which 
regulates  the  operations  of  the  Stock  Exchange  of  Buenos 
Ayres,  and  such  is  its  method  of  operation.  Let  us  now 
examine  the  total  amount  of  its  operations  during  the  period 
1895-1908,  and  how  they  may  be  analysed: — 

Pounds  (Sterling). 


Year. 

Piastres  (Paper). 

1805 
1896 

1,244,602,058 
1,383,472,329 

1897 
1898 

1,306,531,655 
1,219,304,846 

Carry 

forward, 

5,153,910,888 

*  Literally,  •'  at  the  basket." — [Tkans.] 

t  The  brokerage  is  ^  per  cent,  on  the  sale  or  purchase  of  bonds,  shares,  de- 
bentures, etc.,  and  is  charged  on  the  face  (or  nominal)  value  of  the  amount 
changing  hands.  A  charge  of  J  per  cent,  is  also  made  on  all  operations  on 
Exchange. 


284    THE  ARGENTINE  IN  THE  20th  CENTURY 


Year. 

Piastres  (Paper). 

Pounds  (Sterling). 

Brought  forward, 

5,153,910,888 

1899      ... 

1,295,304,846 

— 

1900      ... 

834,982,214 

£73,478,434« 

1901      ... 

1,003,709,984 

88,326,476 

1902      ... 

841,627,532 

74,063,222 

1903      ... 

383,905,622 

33,783,694 

1904      ... 

423,957,361 

37,308,227 

1905      ... 

515,607,316 

45,373,454 

1906      „. 

... 

655,624,566 

57,694,961 

1907      ... 

192,130,565 

16,907,489 

1908      ... 

143,466,502 

12,625,052 

Total  for  14 

years     ... 

$11,444,377,390 

(9  Years),  £439,561,009 

Of  this  total  an  amount  of  8724  millions  of  piastres,  or 
76"2  per  cent.,  applies  to  metallic  operations,  which  kept 
speculation  alive  until  the  monetary  law  of  1899  once  and 
for  all  arrested  the  varying  values  of  paper  money.  If  this 
law  had  had  no  other  effect,  this  result  alone  would  have 
justified  it  as  wholly  beneficial  to  the  interests  of  the  nation. 

In  the  quotations  of  the  above  period  mortgage  bonds 
hold  the  second  place ;  they  represent  about  5  per  cent. 

Being  dominated  by  the  spirit  of  speculation,  which 
expended  itself  principally,  indeed  almost  exclusively,  upon 
monetary  transactions,  the  Bourse  had  no  time  to  devote 
itself  to  more  legitimate  business.  Thus  the  public  funds 
represented  only  some  3  per  cent,  of  this  total ;  then  came 
shares  and  debentures  of  various  companies ;  and  last  of  all 
banking  shares,  the  amount  of  these  being  insignificant. 

The  nominal  value  of  all  the  securities  which  were 
quoted  on  the  Buenos  Ayres  Bourse  in  1907  amounted  to 
|554,791,932  paper  and  $127,763,525  gold,  or  an  actual  total 
of  £74,374,395,  and  an  analysis  gives  the  following  results: — 


Dollars  (Paper). 

Dollars  (Gold). 

Public  funds  and  stocks 

157,025,295 

35,000,000 

National  Mortgage  Cedulas 

129,383,100 

11,443,600 

Provincial         „ 

129,745,642 

— 

Limited  Companies  :  Bhares 

136,657,520 

78,416,320 

Debentures  and  certificates 

1,980,375 

2,903,605 

Totals 

..      $554,791,932 

$127,763,525 

These  two  totals  together  are  equal  to  a  sum  of  £74,374,395. 

*  These  values  are  given  only  from  1900,  when  the  value  of  the  piastre  was 
fixed. 


BANKS  AND  LIMITED  COMPANIES  285 

In  the  first  edition  of  this  book  we  gave  a  summary  of 
the  nominal  value  of  all  the  stocks  quoted  on  the  Buenos 
Ayres  Stock  Exchange  in  1904 ;  the  sura  amounted  to  462 
millions  paper  and  38  millions  gold,  or  a  total  of  £52,256,000  ; 
so  that  in  three  years  these  tigures  had  increased  by  93 
millions  paper  and  70  millions  gold,  or  over  £22,000,000. 

It  is  permissible  to  hope  that  in  the  course  of  time  the 
Buenos  Ayres  Exchange  will  attain  a  far  greater  develop- 
ment, and  that  it  will  even  exercise  some  steadying  influence 
on  the  prices  of  the  public  funds.  To-day  their  real  market 
is  iu  London,  Paris,  or  Berlin,  so  that  the  credit  of  the  country 
is  atiected  by  the  disturbing  events  of  European  markets, 
while,  the  Buenos  Ayres  market  is  devoid  of  any  compen- 
sating effect. 

However,  it  may  be  observed  that  when  a  country  begins 
to  grow  rich  and  to  have  more  assets  at  its  disposal,  the 
public  funds  placed  abroad  show  a  tendency  towards 
repatriation.  We  have  seen  this  in  the  case  of  Italy  and 
Austria,  which  had  an  important  foreign  debt  in  France, 
and  have  considerably  reduced  it  during  these  last  ten  years 
of  economic  progress. 

It  will  certainly  be  the  same  in  the  case  of  the  Argentine 
when,  thanks  to  a  series  of  good  harvests,  its  available  or 
fluid  assets  have  increased  beyond  what  is  absolutely 
necessary  for  the  development  of  agriculture.  Investments 
will  be  made  not  only  in  land  or  in  live  stock,  but  money 
will  be  invested  in  stocks  and  shares  as  well,  and  notably  in 
the  Government  stock  of  the  country. 

As  a  symptom  of  this  tendency,  we  may  mention  that 
interest  on  the  foreign  debt,  the  coupons  for  which  have 
hitherto  been  payable  abroad  only,  is  now  payable  in  the 
Argentine  as  well,  in  order  to  facilitate  the  purchase  of  this 
stock  in  the  Republic  as  a  staple  investment.  The  internal 
debt  is  also  the  object  of  more  extensive  operations,  now 
that  the  seventeen  loans  which  constituted  the  old  debt 
have  been  unified,  and  now  that  a  special  call  is  to  be  made 
upon  the  internal  credit  of  the  countrj''  with  a  view  to  under- 
taking vast  public  works.  To  enlarge  the  market  for  this 
Government  stock  the  authorities  have  just  decided  that  its 
coupons  shall  be  payable  on  the  principal  foreign  markets. 


286    THE  ARGENTINE  IN  THE  20th  CENTURY 

Finally,  in  the  course  of  time  the  market  for  industrial 
stock,  bank  stock,  and  railway  shares  will  gradually  become 
less  restricted,  in  proportion  as  the  public  fortune  becomes 
more  extensively  subdivided,  instead  of  being  concentrated, 
as  it  is  at  present,  in  a  comparatively  small  number  of  hands. 
The  only  thing  that  may  compromise  this  future  is  the 
excessive  speculation  which  we  find,  unhappily  only  too  often, 
in  a  country  where  gambling  is  a  dominant  instinct.  This 
excess,  with  its  natural  sequelae  in  the  form  of  financial 
crises,  might  end  by  driving  all  serious  clients  from  the 
Bourse,  and  in  destroying  the  excellent  elements  which 
Buenos  Ayres  possesses  for  the  creation  of  an  important 
financial  market. 

Limited  Companies. — In  the  vast  progressive  movement 
which  increase  in  force  yearly  throughout  the  Argentine 
Republic,  the  Bourse  of  Buenos  Ayres  has  yet  another  part 
to  play  :  that  is,  to  facilitate  the  formation  of  collectivities  of 
capital  under  the  form  of  joint-stock  companies,  since  the 
spirit  of  enterprise  exhibits  itself  by  preference  under  this 
form.  Collective  efibrt  is  to-day  more  and  more  replacing 
individual  effort ;  the  Argentine  must  therefore  learn  how 
to  employ  this  weapon  of  associated  capital  in  order  to 
promote  new  undertakings,  and,  by  popularising  movable 
values  or  securities  by  the  help  of  the  Bourse,  to  raise  up 
new  resources  to  the  country's  profit. 

Our  study  of  the  chief  manifestations  of  Argentine  life 
and  its  commercial  machinery  would  thus  be  incomplete  if 
we  did  not  give  some  account  of  the  public  companies  of  the 
Argentine,  the  legal  formalities  demanded  of  them  upon 
their  formation,  their  mechanism,  and  the  vicissitudes  through 
which  they  have  passed  at  various  interesting  periods  of 
Argentine  history. 

The  constitution  of  public  companies  is  subjected  by  the 
Commercial  Code  to  rigid  formalities,  in  accordance  with  the 
most  advanced  principles  of  universal  legislation  upon  such 
matters,  in  order  to  assure  their  proper  operation  as  well  as 
the  interests  of  the  shareholders. 

The  indispensable  conditions  of  the  formation  of  such 
companies  are  the  following :  the  number  of  associates  must 
not  be  more  than  ten;  the  capital  of  the  venture,  or  its  first 


BANKS  AND  LIMITED  COMPANIES  287 

issue,  must  not  be  less  than  20  per  cent,  of  the  total,  and  must 
be  entirely  paid  up ;  the  shareholders  must  contribute  10 
per  cent,  of  the  capital  actually  subscribed,  a  sum  which  must 
be  deposited  in  an  official  or  private  bank  ;  the  company 
must  be  constituted  for  a  fixed  term,  and  must  be  authorised 
by  the  Government,  which  cannot  refuse  its  authorisation 
if  the  functions,  organisation,  and  articles  of  the  company 
are  in  conformity  with  the  code,  and  if  its  object  is  not 
contrary  to  the  public  interests. 

To  gain  the  right  to  publish  the  prospectus  appealing  to 
possible  shareholders,  the  company  must  also  conform  to 
the  following  rules :  it  must  indicate  the  date  of  the 
provisional  formation  of  the  company,  must  mention  the 
place  where  the  charter  of  the  company  was  drawn  up  and 
registered,  and  what  journals  have  published  the  articles 
and  the  Governmental  authorisation ;  it  must  give  details  of 
the  object  of  the  company,  its  capital,  the  number  of  shares, 
and  the  conditions  of  subscription  and  payment ;  it  must 
explain  the  exceptional  advantages  claimed  by  the  founders 
of  the  company,  and  convoke  the  subscribers  to  a  general 
meeting,  which  must  take  place  within  three  months,  at 
which  the  company  shall  be  definitively  constituted. 

The  law  formally  forbids  the  founders  of  limited 
companies  to  reserve  any  sum  or  advantage  whatever,  in 
the  form  of  shares,  debentures,  or  founders'  shares,  in  ex- 
change for  concessions  gratuitously  granted  by  the  Govern- 
ment. It  concedes  them  a  maximum  of  10  per  cent,  of  the 
capital,  or  10  per  cent,  of  the  realised  and  liquid  profits 
during  a  term  which  must  not  exceed  ten  years. 

The  founders  or  administrators  of  any  company  are 
responsible,  jointly  and  severally  and  without  any  limit, 
for  all  that  has  been  done  in  the  name  of  the  company  up 
to  the  time  of  its  definitive  constitution,  without  appeal 
against  the  latter,  if  it  take  place. 

If  the  company  be  finally  constituted,  the  expenses  and 
the  consequences  of  all  proceedings  undertaken  to  that  end 
by  the  founders  will  be  charged  against  the  exclusive  account 
of  these  latter,  nor  will  they  have  any  resort  or  recourse  to 
appeal  against  the  subscribers. 

In  the  case  of  limited  companies  which  are  not  legally 


288    THE  ARGENTINE  IN  THE  20th  CENTURY 

constituted,  the  founders,  administrators  and  representatives 
are,  conjointly  and  severally  and  without  limit,  required  to 
restore  any  sums  they  may  have  received  for  shares  issued, 
and  also  to  pay  the  debts  of  administration  and  the  losses 
that  may  be  incurred  by  third  parties  by  the  failure  to  fulfil 
obligations  contracted  in  the  name  of  the  company. 

Once  a  limited  company  is  constituted,  its  administrators 
contract  no  common  or  personal  responsibility  for  the 
engagements  of  the  company,  but  they  are  responsible, 
personally  and  conjointly,  to  the  company  and  to  third 
parties,  for  the  failure  of  execution  or  the  improper  employ- 
ment of  their  mandate,  and  also  for  the  violation  of  laws, 
regulations,  and  statutes. 

All  companies  are  obliged  to  appoint  at  least  once  a  year  a 
censor  chosen  by  the  general  meeting,  who  directly  represents 
the  shareholders,  and  who  supervises  the  proper  conduct  of 
the  company,  and  the  accomplishment  of  the  legal  formalities 
which  concern  it. 

The  Commercial  Code  contains  many  other  enactments 
which  tend  to  ensure  the  correct  and  legal  constitution,  as 
well  as  the  proper  conduct,  of  limited  companies :  but  those 
we  have  cited  will  suffice  to  show  that  the  law-maker  has 
striven  to  use  the  utmost  foresight,  with  the  object  of 
guaranteeing  the  interests  and  the  capital  confided  to  such 
companies. 

Despite  this  prudence  and  foresight,  we  are  forced  to 
recognise  that  the  institution  of  such  companies,  which 
constitutes  a  powerful  economic  lever  when  they  are  correctly 
administered  and  established  with  a  view  to  commercial  and 
industrial  utility,  is  at  present  discredited  on  account  of  the 
abuses  committed  in  its  name  at  the  time  of  the  great  crisis 
of  1890. 

The  institution  of  limited  companies  is  so  intimately 
connected  with  the  financial  disasters  of  that  period  that 
its  history  is  to  a  certain  extent  the  history  of  speculation, 
and  it  has  suffered  all  the  vicissitudes  of  speculation. 

In  1882,  when  Buenos  Ayres  was  federalised  and  became 
the  permanent  capital  of  the  Republic;  when  public  tran- 
quillity was  confirmed,  with  the  conviction  that  it  would 
be  long  before  it  was  disturbed ;  when  the  public  expenditure 


BANKS  AND  LIMITED  COMPANIES  289 

was  increased,  thanks  to  the  employment  of  credit  and  the 
issue  of  paper  currency ;  when,  in  short,  the  prospect  of 
universal  prosperity  had  awakened  energy  and  initiative ; 
there  began  to  pass  through  the  country  a  light  breeze  of 
speculation,  which  was  soon  to  become  a  tempest;  and  the 
limited  company,  which  until  that  time  had  existed  in  a 
modest,  inconspicuous  degree,  quickly  assumed  a  greater 
importance,  with  a  more  definite,  more  concrete  form. 

The  companies  floated  in  1882  and  in  the  three  following 
years  were  not  very  numerous,  and  their  capital  was  in- 
significant as  compared  with  the  capital  of  those  that 
followed :  yet  a  very  marked  impulse  towards  progress  was 
already  perceptible,  as  much  in  numbers  as  in  capital.  Thus 
the  sum  of  10  million  piastres,  the  amount  of  the  nominal 
capital  declared  by  the  limited  companies  in  1882,  rose  to 
nearly  13  millions  in  1885. 

But  as  the  fever  of  speculation  and  affairs  grew  higher 
and  ever  higher,  thanks  to  the  aid  of  the  credit  too  liberally 
granted  by  the  banks,  whether  mortgage  or  money-lending 
banks  or  otherwise,  and  as  at  the  same  time  all  the  paper 
thrown  upon  the  market  was  immediately  absorbed,  to  the 
great  profit  of  those  who  issued  it,  the  limited  company 
followed  the  upward  march,  although  this  movement  did  not 
always  correspond  with  the  idea  of  progress.  Thus  we  see 
with  surprise   that  from  13  millions  of   piastres  (paper)  in 

1885,  the  capital  of   the  companies  rises  to  34  millions  in 

1886,  to  95  millions  in  1887,  to  196  millions  in  1888,  and  in 
1889  to  378  millions  ;  and  in  these  two  latter  years  the  fever 
has  reached  the  period  of  greatest  danger. 

In  1890  the  economic-financial  crisis,  long  delayed  by 
artificial  means,  burst  over  the  country  with  terrible  force, 
and  a  revolution  broke  out  simultaneously.  Under  the 
weight  of  this  double  disaster  the  banking  houses  tottered 
on  their  foundations,  soon  to  fall  in  ruin  ;  credit,  personal  or 
secured,  vanished  absolutely ;  the  paper  currency,  already 
depreciated,  fell  to  a  still  lower  value;  industry  and  commerce 
were  arrested  in  their  progress,  and  the  whirligig  of  specula- 
tion, which  had  so  far  gone  merrily  but  giddily  round,  came 
to  an  abrupt  standstill.  As  a  natural  reaction,  the  formation 
of  companies,  which   speculation  had  stimulated  to  excess, 


290    THE  ARGENTINE  IN  THE  20th  CENTURY 

was  stricken  with  an  almost  complete  paralysis ;  so  that  we 
see  the  capital  of  these  companies,  which  in  1889  had  risen  to 
878  millions  of  piastres,  fall  in  1890  to  190  millions,  and 
finally,  in  1891,  to  the  modest  sum  of  13  millions. 

These,  rapidly  denoted,  are  the  salient  lines  of  a  sketch 
of  the  vicissitudes  of  speculation  and  the  affairs  of  the  capital 
during  the  last  ten  years  ;  a  picture  which  begins  with  the 
rosy  tints  of  hope  and  illusion,  and  ends  in  the  sombre  colours 
of  bankruptcy  and  ruin. 

The  branches  of  trade  and  industry  which  are  most 
largely  represented  by  the  limited  company  form  another 
question  of  interest.  It  is  certainly  very  difficult  to  discover 
the  true  social  idea  which  these  companies  pursue  at  flotation, 
for  behind  pompous  titles  which  seem  to  express  a  true 
national  progress,  such  as  the  construction  of  harbours,  the 
foundation  of  colonies,  the  building  or  management  of  rail- 
ways or  tramways,  the  opening  up  of  new  districts  by  means 
of  canals,  etc.,  there  lurks,  only  too  often,  a  mere  scheme 
of  speculation  in  shares  or  land.  Judging,  however,  by  the 
actual  operations  effected  by  these  companies  during  the 
course  of  their  existence,  we  can  class  them  according  to 
the  object  declared  at  the  time  of  flotation,  and  at  the  same 
time  give  the  statistics  of  their  capital. 

The  capital  of  all  the  companies  floated  since  1882 
amounts  to  950  millions  of  piastres  (paper),  or  £83,600,000. 
Of  this  sum  £14,320,000  was  frankly  intended  to  promote 
speculation  in  land;  £13,200,000  was  applied  to  railways 
(including  the  purchase  of  the  railways  of  the  Province  of 
Buenos  Ayres) ;  £12,144,000  to  insurance  (a  form  of  employ- 
ing capital  much  in  vogue  at  the  time),  and  £12,056,000  to 
banking  affairs,  which  in  some  cases  were  only  the  mask  of 
speculations  in  stock  and  in  land. 

To  make  our  sketch  complete  we  ought  to  give,  instead 
of  the  nominal  capital  declared  by  these  companies,  the 
capital  actually  paid  up ;  as  we  know  that  it  is  not  every 
company  that  has  at  its  disposal  the  sum  mentioned  in  its 
articles,  but  that  many  have  to  be  content  with  the  payment 
of  one  or  two  instalments,  while  others  cannot  even  find 
subscribers.  Knowing  these  data,  and  being  cognisant  of 
the  present  condition  of  the  companies,  we  should  then  be 


BANKS  AND  LIMITED  COMPANIES  291 

able  to  estimate  the  amount  of  lose  which  they  have  in- 
flicted upon  the  country. 

Unfoi'tunately  this  investigation  is  impossible,  for  lack 
of  information,  and  vp^e  can  only  state  that  millions  of 
pounds  of  private  fortunes  were  lost  or  stolen  in  the  limited 
companies  of  the  period. 

After  the  crisis  of  1890  there  was,  as  there  was  bound  to 
be,  a  great  mental  reaction  ;  especially  in  matters  relating 
to  the  institution  of  the  limited  company ;  and  the  latter  was 
so  discredited  that  for  several  years  not  a  penny  could  be 
obtained  for  investment  in  undertakings  of  the  kind. 

But  it  was  not  possible  that  such  an  important  element 
of  economic  progress  should  be  entirely  suppressed  on 
account  of  the  abuses  committed  in  its  name.  Very  slowly 
it  came  into  favour  once  more ;  but  thanks  to  the  lessons 
of  experience  the  new  companies  were  concerned  in  the 
foundation  of  undertakings  of  genuine  industrial  and 
commercial  value.  Thus  the  companies  floated  in  1902, 
1903,  and  1904  represented  a  nominal  capital  of  $803,979,000 
paper  (£70,950,352  actual  value),  and  those  founded  from 
1905  to  1908  (inclusive)  had  a  nominal  capital  of  £72,573,445, 
i      which  may  be  analysed  as  follows  : — 


Land           

£1,676,959 

Railways    ... 

6,059,791-7 

Insurance  ... 

13,593,981-5 

Banks          

9,251,968-1 

Industry    ... 

7,295,793-2 

Commerce  ... 

6.856,762-3 

Agriculture  and  stock-raising 

7,218,579-7 

Navigation             

440,000-0 

Colonisation  and  Immigration 

293,996-3 

Tramways 

5,113,303-1 

Hygiene      

564,759-5 

Telephones  and  telegraphs 

1,349,983-8 

Mines 

7,332,286 

Mortgage  Companies  and  Real  Estate 

Companies     ... 

4,098,448-1 

Gas  and  electric  lighting             

759,249 

Savings  Banks      

667,598-8 

Total 

.£72,573,450 

The    mere  list  of   the  above  investments  is  enough   to 
convince  us  that  the  day  of  merely  speculative  companies 


292    THE  ARGENTINE  IN  THE  20th  CENTURY 

is  over,  when  shares  were  mere  travesties,  more  or  less 
justified,  as  in  the  years  which  preceded  the  crisis  of  1890, 
Now  speculation  in  land  is  represented  by  a  sum  of  less 
than  £1,700,000  ;  while  insurance  is  represented  by  over  13 
millions,  banks  by  more  than  9  millions,  industry  by 
7  millions,  agriculture  by  7  millions,  and  mines  by 
about  the  same  amount.  These  latter  investments  belong 
to  the  category  of  "  eruptive  "  stock,  for,  like  a  volcanic 
eruption,  they  rise  suddenly  to  great  heights,  to  fall,  a  little 
later,  leaving  nothing  but  smoke  and  ashes. 

In  the  matter  of  company  formation,  as  in  the  matter  of 
operations  of  the  Bourse,  we  see  that  the  Argentine  has 
re-entered  the  normal  path  of  progress.  Under  these  two 
manifestations,  which  reflect  the  economic  activity  of  the 
country,  the  tide  of  affairs  continues  to  increase,  but  the 
spirit  of  speculation  no  longer  turns  it  aside,  no  longer 
undermines  the  organisation  of  the  nation's  commerce. 


\ 


PART  IV 

ARGENTINE  FINANCE 


CHAPTER   I 

THE   ARGENTINE   BUDGET 

The  financial  situation — Continual  increase  of  national  expenditure — Great  and 
rapid  progress  since  1891 — Insufficiency  of  the  means  adopted  to  moderate 
this  increase — The  Budget  Extraordinary  and  the  Special  Legislation 
Budget. 

Causes  of  this  increase  of  national  expenditure — The  increase  of  administrative 
requirements  caused  by  an  increasing  population  ;  this  is  the  most  natural 
cause,  and  that  most  easily  justified — Increase  of  the  public,  debt — The 
intervention  of  the  State  as  the  promoter  or  guarantor  of  important  public 
undertakings — Exaggerated  military  expenses. 

The  total  sum  of  national,  provincial,  and  municipal  expenses.  The  proportion 
per  inhabitant — Comparison  with  other  foreign  countries  in  the  matter  of 
administrative  expenses. 

The  national  revenue — The  revenue  as  organised  by  the  Constitution,  and  its 
analysis — Indirect  taxation — The  customs  the  chief  source  of  revenue — 
Direct  taxation ;  its  origin  in  the  Argentine ;  its  justification  ;  its  yield — 
Revenue  of  the  industrial  undertakings  belonging  to  the  State  :  railways, 
sewers,  posts  and  telegraphs — The  exploitation  of  the  State  lands. 

Elasticity  of  the  receipts,  which  follow  the  development  and  progress  of  the 
country — The  accelerated  increase  of  expenditure,  and  the  resulting  chronic 
deficit — Necessity  of  serious  reformfi. 

THE  phenomenon  of  an  increase  in  the  national  expendi- 
ture :  a  phenomenon  which  makes  itself  felt  under 
monarchies  as  well  as  under  republics,  in  those  countries 
which  have  long  centuries  of  life  behind  them,  as  in  those 
whose  independent  existence  has  barely  begun  :  this  phenom- 
enon is  felt  in  the  Argentine  Republic  more  keenly  than 
in  the  older  nations  of  Europe.  Our  book  would  present 
a  serious  lacuna  if  we  did  not,  before  speaking  of  the  increase 
of  the  Argentine  budgets,  inquire  first  of  all,  as  closely  as  we 
can  in  a  work  of  information,  what  are  the  causea  which 
have  led  to  this  continual  increase  in  the  national  expenses. 
We  must  know,  in  short,  whether  this  increase  is  due  to 
general  causes,  produced  by  administrative  necessities,  and 
connected  with  the  mere  progress  of  the  country,  or  whether 
on  the  contrary  it  arises  from  special  factors,  peculiar  to  the 
social  and  political  conditions  of  the  country,  and  to  the 
295 


296    THE  ARGENTINE  IN  THE  20th  CENTURY 

practical  defects  of  its  Government.  If  we  examine  th( 
amounts  of  the  Argentine  budgets  for  a  number  of  years 
we  shall  see  that,  with  a  few  rare  exceptions,  they  have 
always  increased,  and  at  a  more  or  less  extraordinary  rate 
Even  in  the  years  when  the  country  was  groaning  undei 
some  profound  economic  or  financial  crisis  the  same  thing 
was  to  be  observed. 

Not  to  go  back  too  far  in  our  retrospective  study,  let  ue 
take  as  a  point  of  departure  the  year  1891,  which  year  is  a 
veritable  landmark  in  the  history  of  the  Argentine  people,, 
since  it  was  in  that  year  that  the  political  and  financial  crisis 
which  broke  over  the  country  attained  its  greatest  intensity. 
We  find  that  in  1891  the  expenditure  authorised  by  the 
national  budget — not  the  expenditure  actually  effected,  with 
which  we  shall  deal  further  on — amounted  to  |41,2o0,349 
paper  and  |20,315,446  gold,  or  some  31  millions  in  gold,  or 
£6,200,000. 

Five  years  later — in  1895 — this  expenditure  had  increased 
to  $76,000,000  paper  and  $15,000,000  gold,  or  $37,000,000  in 
gold,  or  £7,400,000.  Since  then,  with  rare  exceptions,  the 
budgets  have  followed  an  ascending  scale.  If,  indeed,  we 
concern  ourselves  with  the  sums  actually  realised,  instead  of 
those  proposed  by  the  budgets,  we  find  that  the  amounts  of 
the  later  budgets  are  these :  in  1898,  S75,OOO,O0O  gold  and 
$119,000,000  paper,  or  $121,000,000  in  gold,  or  £24,200,000 ; 
in  1899,  $31,000,000  gold  and  $104,000,000  paper,  or 
$77,000,000  in  gold,  or  £15,400,000 ;  in  1900,  $24,000,000 
gold  and  $105,000,000  paper,  or  $69,000,000  in  gold,  or 
£13,800,000,  Reducing  to  gold  the  sums  estimated  in  paper, 
we  find  that  since  1901,  that  is,  since  the  time  when  the 
value  of  the  currency  was  established  on  a  fixed  basis,  the 
following  sums  have  been  expended:  in  1901,  £14,200,000 ; 
in  1902,  £17,600,000;  in  1903,  £15,600,000;  in  1904, 
£17,200,000;  in  1907,  £20,200,000;  in  1908,  £20,200,000; 
there  has  thus  been  a  rapid  progress. 

The  budget  for  1909  amounts  to  $270,000,000  paper,  or 
£23,812,800.  In  this  total  are  comprised  two  items  :  one  of 
15  millions  of  piastres  in  paper,  value  £1,320,000  ;  the  other 
of  3  millions,  or  £264,000,  which  £.re  set  aside  to  meet  the 
expenses  of  the  fetes  of  the  first  Centenary  of  the  National 


THE  ARGENTINE  BUDGET  297 

;lt  I  Re  volution.  If  we  subtract  these  two  items,  which  are 
15  necessitated  by  extraordinary  expenses,  we  find  that  the 
II  increase  of  the  administrative  expenditure  over  that  of  1908 
t<  amounts  to  £1,760,000. 

It  I        We  ought  here  to  remark  that  these  figures  do  not  inchide 
D!  ithe  sums  realised  by  the  Government  by  means  of  the  issue 
of  stock :    a   procedure   which    coustitutes    an    interesting 
t : chapter  of  Argentine  finance. 

i-         We  see,  from  these  data,  that  the  increase  of  the  national 
}i  expenditure    is    a    constant,    almost    an    inevitable    factor, 
SI  i  which    occurs   year  by   year   in    the  Argentine   administra- 
;t  tion.     It  now  remains  for  us  to  inquire  if  unavoidable  causes 
i  exist  which  force  the  State  to  spend  without  reflection,  and, 
t  ,when  funds  are  lacking,  to  contract  loans  which  grievously 
i  I  burden  the  future;   or  whether,  on   the  contrary,  we   have 
[.  ,here  a  fault  rooted  in  the  soil  of  new  countries  which  have 
I  no  serious  administrative  traditions,  and  in  which  the  spirit 
»  [of  order  and  economy  has  not  yet  grown  to  the  stature  of  a 
,  i  national  virtue.     In  the  Argentine  Republic  the  increase  of 
public   expenditure   responds   to   causes   which   differ   from 
those  which  are  active  in  the  countries  of  Europe;  though 
we   do  not  say  that  the  latter  do   not  also  exercise  their 
influence.     A  new  country,  inhabited  by  a  sparsely-settled 
population,  in  possession  of   a  rich  but  desert  territory,  its 
economic  organism  as  yet  barely  developed,  the  Argentine 
has  not  yet  produced  a  class  of  men  practised  in  and  pre- 
pared for  practical  administration.     It   is,  on  the  contrary, 
afflicted  with  undisciplined  political  parties,  full  of  impatience 
,  and  of  ideas  of  progress  which  cannot  be  immediately  realised. 
lit  is  not  surprising   that   in  the  Argentine  the  increase  of 
public  expenditure   responds   to   causes  unlike   those   to  be 
observed  in  other  States,  which  number  the  years  of  their 
lives  in  centuries ;   which   enjoy   perfected   administrations, 
I  possess  a   large   class   of   men   prepared   for  the  science  of 
government  and  finance,  and  whose  needs,  far  from  increasing, 
tend  to  restrain  such  expenditure. 

So,   considering    the    question   under    its    most   general 

aspect,  we  believe  we  shall  not  depart  very  far  from   the 

,  truth  if  we  suggest,  as  the  causes  which  produce  the  constant 

increase   of   the   Argentine    budgets,   the    following    facts : 


298    THE  ARGENTINE  IN  THE  20th  CENTURY 

(1)  the  increase  of  administrative  requirements,  caused  by  0 
the  increase  of  the  population  ;  (2)  the  increase  of  the  public  i  40 
debt;  (3)  the  depreciation  of  the  currency  until  a  recent  1  ^  las^* 
period,  and  the  increasing  dearness  of  the  necessities  of  life ;  'g0 
(4)  national  and  foreign  wars  (which  causes  now  belong  to  jgito 
history,  and  have  happily  ceased  to  exercise  their  influence  iloii 
in  the  Argentine);  (5)  the  intervention  of  the  State  as  ijjispi 
manager  or  promoter  of  expensive  public  works;  (6)  the  '  h 
cost  of  an  imperfect  and  expensive  administrative  machinery,  \  \0i 
and  the  wastefulness  of  the  Government  and  of  Congress ;  0i 
(7)  a  lack  of  control  in  the  handling  of  revenue  and  expendi-  0, 
ture ;  (8)  increased  military  expenditure.  Under  this  last  \  tif 
heading  we  may  include  the  heavy  expenses  which  the  ii 
Government  has  been  forced  to  meet  in  order  to  maintain  the  ;  mi 
integrity  of  its  frontier  and  to  avoid  a  war  with  Chili. ;  Ew 
Between  1889  and  1903  it  has  employed  for  this  purpose  a 
sum  of  £13,000,000. 

A  brief  examination  of  each  of  these  causes  will  suffice 
to  show  that  they  have  been  truly  presented,  and  will  also 
demonstrate  the  degree  in  which  the  phenomenon  we  are 
studying  exhibits  itself. 

The  influence  of  the  first  factor  is  assured  and  indisput- 
able ;  it  is  enough  to  enounce  it ;  it  will  be  admitted  with- 
out further  criticism.  The  increase  of  the  Argentine  popula- 
tion, although  it  is  not  precisely  all  that  might  be  desired, 
because  it  is  not  equally  distributed,  being  larger  on  the 
coast  than  in  the  interior,  is  none  the  less  considerable.  The 
first  national  census  of  1869  gave  a  population  of  1,877,000 
for  the  whole  country;  that  of  1895  gave  4  millions;  an 
increase  of  more  than  2,100,000,  or  of  48  per  cent,  per 
annum. 

Since  1895,  although  the  Constitution  orders  a  ten-yearly 
census,  no  census  has  actually  been  taken.  But  according 
to  the  most  reliable  calculations,  the  population  of  the 
Argentine  amounts  at  present  to  more  than  6  millions  of 
inhabitants. 

It  is  obvious  that  an  increased  population  must  also 
mean  an  increased  administrative  expenditure,  as  more  tele- 
graphs are  needed,  more  bridges,  roads,  and  railways,  a  larger 
police  service,  more  lawyers  and  judges,  and  more  schools 


THE  ARGENTINE  BUDGET  299 


I 


nd  teachers.  No  sensible  person  would  pretend  that  the 
;iational  expenditure  could  remain  unchanged,  while  all  else 
was  developing  and  prospering.  If  the  national  revenue 
increases  at  an  extraordinary  rate,  on  account  of  the  develop- 
ment of  the  population,  it  is  only  logical  that  the  expenditure 
should  increase  likewise ;  but  in  a  less  proportion,  it  is  true, 
;s  is  proper  under  a  good  administration. 

But  this  is  not  to  say  that  it  is  permissible  for  adminis- 
trators entrusted  with  the  annual  duty  of  presenting  an 
estimate  of  public  expenditure  to  do  what  is  occasionally 
done,  with  such  deplorable  results — to  estimate  also  in  an 
Exaggerated  fashion  the  increase  of  the  population,  in  order 
all  the  more  to  inflate  the  budget.  The  profound  financial 
icrisis,  which  affected  the  country  in  1890,  had  no  other  cause. 
Everything  is  risked  by  the  abuses  of  official  expenditure. 
jWe  have  the  proof  of  this  in  the  fact  that  the  economic 
'possibilities  of  the  country  have  never  been  so  great  as  in 
these  moments  of  financial  crisis. 

The  continual  increase  of  the  public  debt  is  another  of 
the  causes  of  exaggerated  budgets.  Since  the  first  loan  of 
£1,000,000,  contracted  by  the  Province  of  Buenos  Ayres  in 
11822,  which  was  later  transferred  to  the  account  of  the 
ination,  until  the  present  time,  when,  if  no  new  loans  have 
jbeen  contracted,  at  least  the  Government  has  put  into  circula- 
Ition  millions  of  stock  which  it  was  holding  in  reserve,  the 
'public  debt  has  done  nothing  but  increase,  and  in  con- 
siderable proportions,  attaining  in  1^09  to  an  amount  of 
,-^371,000,000  gold  and  $237,000,000  paper,  or  £95,000,000  in 
all ;  and  this,  without  including  the  last  loan  of  £10,000,000 
contracted  by  the  Government  in  March  1909. 

Another  permanent  cause  of  the  increase  of  public  ex- 
Ipenditure  is  that  which  arises  from  the  intervention  of 
the  State,  as  guarantor  or  promoter  of  costly  public 
works. 

The  Argentine  Constitution  has  very  wisely  instructed 
Congress  to  "  promote  the  introduction  and  the  establishment 
of  various  industries  and  of  immigration ;  the  construction  of 
railways  and  navigable  waterways;  the  colonisation  of  the 
lands  belonging  to  the  nation,  and  the  importation  of  foreign 
capital  and  the  exploitation  of  the  rivers  of  the  interior,  by 


300    THE  ARGENTINE  IN  THE  20th  CENTURY 

means  of  protective  laws,  temporary  concessions,  privileges, 
and  awards,  which  shall  be  an  incentive  to  emulation."  I  ^ 

In  these  sentences  the  writers  were  inspired  only  by  the  ■  fi 
embryonic  condition  of  the  country  for  which  they  legislated.  I  j 
In  the  old-established  European  nations,  where  great  accumu- 
lations of  capital  exist,  where  everything  is  done  by  personal 
initiative,   where   the    commercial    and   industrial    spirit  isj 
highly  developed,  many  of  the  prescriptions  of  the  Argentine' 
Constitution  would   be   useless   or   out  of  date.     But  here, 
where  capital  is  only  beginning  to  exist,  as  a  result  of  the 
large  commercial  balance  left  over  from  each  year  of  inter-j 
national  trade  ;  here  where,  to  use  the  phrase  of  an  Argentine | 
thinker,  "  we  are  naturally  rich  but  economically  poor,"  the  i 
State  has  to  turn  to  all  trades;  it  has  to  go  into  business  as. 
contractor,   encourage   the    establishment   of    industries  byj 
means  of  premiums  or  bounties,  and  stimulate  the  introduc- 
tion of  capital  and  of  immigrants. 

The  last  of  the  causes  we  have  cited  as  determining  the 
increase  of  public  expenditure  in  the  Argentine,  is  the 
increase  of  military  expenses.  We  do  not  here  refer  to 
the  extraordinary  expenses  which  the  Government  had  toil 
support  for  a  number  of  years,  in  order  to  acquire  the 
elements  of  naval  and  territorial  defence  wherewith  to  meet 
the  possible  aggressions  of  a  neighbouring  State,  but  the 
ordinary  annual  expenses  for  the  upkeep  of  the  army  and 
the  navy. 

Up  to  1902  these  expenses  followed  a  scale  of  accelerated 
increase,  and  the  country  met  them  as  a  necessary  sacrifice, 
dominated  by  the  conviction  that  by  this  means  it  could 
evade  the  greater  calamities  of  a  war  ;  and  quieted  at  the 
same  time  by  the  promises  which  were  given  that  once  the 
danger  had  passed  the  expenses  would  naturally  decrease. 

Unhappily  it  was  not  so.  Although  the  international 
horizon  was  clear  of  the  cloud  which  had  threatened  to 
disturb  the  tranquillity  of  the  country,  the  army  and  navy 
estimates  showed  no  signs  of  abatement  ;  on  the  contrary, 
they  showed  a  tendency  to  increase.  Thus  in  1902,  when 
the  international  question  was  in  an  acute  stage,  and  a 
rupture  was  momentarily  expected,  these  estimates  amounted 
to  £2,816,000. 


THE  ARGENTINE  BUDGET  301 

Now,  in  1909,  with  peace  and  tranquillity  roigiiinj^  on 
all  sides,  the  war-budget  still  amounts  to  £1,980,000,  and 
:  the  naval  budget  to  £1,452,000  ;  or  to  more  than  £3,400.000 
>  in  all.  We  repeat  that  these  are  ordinary,  not  oxtra- 
'  ordinary  budgets,  whose  amount  is  always  considerable,  and 
'  which  have  to  be  met  by  means  of  sums  raised  by  special 
'  financial  laws,  or  authorised  by  simple  resolutions  of  the 
:   Cabinet  or  Council  of  Ministers. 

■  To  these  military  expenses  we  must  add  the  sums 
I  required  to  pay  the  retiring  gratuities  of  officers,  and  these 
!  already  amount  to  a  veritable  army.  These  gratuities, 
I  granted  under  the  provisions  of  an  irrational  law,  have  con- 
!  tributed  to  deprive  the  army  of  a  large  number  of  soldiers 
•  who  niiofht  still  be  serving  with  honour  and  distinction. 
I  But   large   as   these   expenses   are,   they   are   altogether 

I  eclipsed  by  the  exorbitant  sum  of  £14,920,000  voted  by 
1  Congress  in  1908,  which,  divided  into  eight  annuities,  is 
'   destined  for  the  purchase  of  munitions  of  war,  ships,  etc. 

The   Argentine,  by  consenting  to   such  expenses,  which 
i   are  as  excessive  as  they  are  unjustified,  is  thus  deliberately 
!  entering  upon  the  policy  of  armed  peace,  which  has  produced 
such  lamentable  results  among  the  nations  of  Europe. 

I         The  figures  we  have  already  given,  which  relate  to  the 
j  National  Budget,  represent  a  portion  only  of  the  expenses 
I  which   weigh    upon    the   inhabitants    of   the   country;    for 
I  they  do  not  include  those  amounts  requisite  for  the  support 
i  of  the  provincial  and  municipal  administrations  of  the  entire 
1  Republic.     The  amount  of  all  the  budgets  together — national, 
provincial  and  municipal — amounted,  in  1908,  to  £29,200,000. 
Each  one  of  the  six-million  inhabitants  of  the  Argentine 
must  thus  annually  contribute  nearly  £5  towards  the  support 
of  the  public  administrations.     But  in  reality  this  contribu- 
tion  is   still  heavier,  as   the  expenses  which    figure   in  the 
budget  are  only  a  part  of  the  administrative  expenses,  and 
we  must  still  add  the  expenditure  authorised  by  special  laws 
or  resolutions  of  the  Cabinet. 

This  proportion  of   £5  per  inhabitant   is  enormous ;    to 
understand   how  large   it  is,  we  must  compare  it  with  the 
amounts  charged  in  other  and  more  advanced  countries.     On 
u 


302    THE  ARGENTINE  IN  THE  20th  CENTURY 

the  other  hand  it  is  stated  that  some  30  per  cent,  of  the 
whole  national  expenditure  is  absorbed  by  the  salaries  of  the 
administrative  employes,  functionaries,  ministers,  etc.,  and 
by  pensions  and  retiring  gratuities. 

Commenting  upon  this  abnormal  situation,  a  sometime 
Minister  of  Finance  remarked  some  years  ago,  in  an  official 
document  which  attracted  attention  by  the  energy  and 
sincerity  with  which  it  was  written : — 

"  Our  budgets  have  constantly  increased  of  late  years. 
It  is  notorious  that  the  personnel  of  the  Administration  is 
excessive,  just  as  it  is  notorious  that  useless  and  expensive 
sinecures  have  been  created,  with  the  sole  object  of  giving 
places  to  persons  whose  influence  has  been  such  that  the 
State  has  undertaken  to  support  them.  Bureaucracy  is  in- 
creasing; industry,  commerce,  and  all  the  spheres  of  free 
endeavour  and  of  individual  effort  are  abandoned  by  the  sons 
of  the  country,  who  seek  salaried  employment  or  the  exercise 
of  intermediary  professions  which  demand  no  effort.  The 
number  of  young  men  who  waste  their  time  in  seeking  a 
place,  instead  of  devoting  their  activities  to  work,  in  a 
country  which  offers  wealth  to  all  who  will  employ  a  little 
energy,  a  little  perseverance,  is  surprising.  But  all  want 
an  easy  life,  even  though  it  be  poor  and  without  horizon ; 
all  wish  to  live  on  the  budget,  and  in  order  to  gain  their 
object  they  exhibit  all  kinds  of  ingenuity;  the}^  go  seeking 
recommendations,  and  employ  every  means  at  their  disposal. 

"  This  host  of  pertinacious  beggars  of  place  results  in  the 
creation  of  new  employments  and  new  services,  all  equally 
useless.  The  national  and  provincial  administrations  pay 
more  than  $65,000,000  in  salaries  and  pensions.  Each 
inhabitant  contributes  six  golden  dollars — £1,  4s.— towards 
the  upkeep  of  an  army  of  employes,  which  is  an  enormous 
sum.  The  public  services  of  other  countries  cost,  per  inhabi- 
tant :  in  Switzerland,  4s.  9-6d. ;  in  the  United  States,  6s.  4-8d. ; 
in  England,  8s.  2-88d. ;  in  Holland,  9s. ;  in  Austria,  lis.  2-88d. ; 
in  Belgium,  12s.  0-48d.;  in  Germany,  12s.  0'96d. ;  in  Italy, 
15s.  9-6d.;  and  in  France  19s.  2-88d.  These  figures,  taken 
from  Paul  Deschanel's  work  on  Decentralisation,  show  us 
that  we  have  outstripped  all  other  nations  in  the  matter  of 
expenditure  on  the  administration ;  even  France  and  Italy, 


THE  ARGENTINE  BUDGET  303 

where  bureauracy  is  regarded  as  a  calamity  and  as  one  of 
the  causes  of  their  economic  decadence. 

"  We  must  check  this  avalanche  by  suppressing  all 
useless  employments  and  all  superfluous  services.  It  is 
essential  to  turn  our  young  men  aside  from  tlieir  present 
path,  in  order  that  necessity  shall  force  them  to  exercise 
their  energies  in  the  vast  field  which  is  offered  them  by  a 
new  country,  full  of  natural  wealth,  with  a  fertile  soil  and 
a  benign  climate."  * 

The  reaction  which  Senor  Rosa,  in  his  genuine  patriotism, 
had  hoped  for,  took  place  a  little  after  his  departure  from  the 
Ministry  of  Finance;  but  unhappily  its  direction  was  the 
reverse  of  that  he  anticipated. 

We  have  examined  the  expenses  of  the  public  administra- 
tions; we  have  measured  the  weight  of  the  public  debt;  we 
must  now  examine  the  treasury  receipts,  in  order  to  discover 
what  are  the  most  important  sources  of  the  revenues  which 
fill  it,  and  what  elasticity  they  possess. 
I  The  Argentine  Constituents,  after  having  explained,  in  the 

!  sententious  preamble  which  serves  as  a  preface  to  their  great 
political  code,  what  place  was  theirs  who  were  building  the 
great  edifice  of  the  State,  turned  to  consider  from  what 
sources  the  revenues  for  the  Treasury  might  be  drawn,  in 
order  to  satisfy  the  necessities  of  the  administration  of  the 
country. 

To  this  effect  they  enacted  that  these  resources  should 

!    be :    "  The   taxes   upon   imports   and   exports ;    the   sale   or 

I  allocation  of  lands  forming  part  of  the  national  territory ; 

j   the  postal  revenues,  and  the  other  taxes,  which  the  General 

Congress  will  impose  equitably  and   in   proportion   to   the 

population ;    also   such   loans   and    credit  operations  as  the 

same    Congress  shall   decree    for   the   urgent   needs  of   the 

nation,  or  for  undertakings  of  national  utility."     (Article  4). 

Has   the   foresight   of   the  Constituents   in   establishing 

these  sources  of  revenue  been  justified  ?  or,  in  other  words, 

were  the  elements  of  revenue  created  by  the  fundamental 

charter  efficacious  ?     A  little  study  of  the  system  of  Argentine 

revenue  will    show    that   of   all  these   sources   enumerated, 

i   the  only  ones  that  have  a  permanent  and  fertile  existence 

*  See  Mimoiri's  des  Finances  dc  1S80,  by  J.  M.  Rosa,  Vol.  II.,  p.  174. 


306    THE  ARGENTINE  IN  THE  20th  CENTURY 

Besides  the  resources  furnished  by  the  indirect  imposts 
of  the  customs,  there  has  since  1891  existed  in  the  Argentine 
another  kind  of  indirect  internal  duty,  which  is  charged 
upon  consumption,  and  which  every  day  acquires  a  greater 
importance,  in  proportion  as  the  country  is  developed  and  as 
wealth  and  population  increase. 

These  duties  were  established  at  a  critical  moment  of  the 
country's  history,  and  they  mark  a  degree  of  evolution  in 
the  financial  system  of  the  country.  In  1891,  when  the 
liquidation  commenced  of  the  great  financial  crisis  which 
had  completely  overturned  the  economic  organisation  of  the 
Argentine,  the  strength  of  the  country  was  broken,  the 
Treasury  was  empty,  and  there  existed  a  public  debt  which 
was  all  the  more  grievous  in  that  the  paper  currency  was 
absolutely  inconvertible,  and  decreased  in  value  daily,  in  the 
midst  of  all  the  difficulties  which  characterised  that  terrible 
time.* 

This  overwhelming  situation  resulted  in  the  establishment 
of  indirect  internal  imposts  ;  that  is,  the  branch  of  taxation 
which  is  levied  on  the  national  industry  and  national  produc- 
tion ;  but  which  is,  in  all  contemporary  nations,  one  of  the 
most  fruitful  sources  of  revenue  ;  the  more  so  as  its  collection 
demands  few  sacrifices  on  the  part  of  those  who  pay  it. 

The  realisation  of  this  fortunate  idea,  which  efiected  an 
important  innovation  in  the  revenue  system,  was  due  to  the 
administration  of  Senor  Carlos  Pellegrini,  in  which  Vincent- 
Fidel  Lopez  was  Minister  of  Finance,  and  was  perhaps  the 
most  important  and  meritorious  act  of  the  administration. 

During  this  first  year  of  1891,  the  receipts  furnished  by 
this  branch  of  taxation  did  not  attain  to  the  expected  results ; 
they  amounted  only  to  £224,682,  distributed  as  follows: 
Alcohols,  £123,511;  beer,  £23,549;  matches,  £76,617;  banks 
and  companies,  £982  ;  total,  £224,660.  Out  of  a  total  collec- 
tion of  $75,501,077  paper  and  $497,120  gold,  or  £6,743,518, 
the  yield  of  internal  duties  amounted  only  to  3'29  per  cent. 
Four  years  later,  after  the  administration  of  internal  duties 
had  undergone  considerable  modifications  and  improvements, 
so  that  the  system  of  collection  had  become  more  exact,  these 
imposts  furnished  the  Treasury  with  £676,946,  which  out  of 

*  See  Memoria  del  Ministerio  de  Hacienda,  1890,  p.  72. 


THE  ARGENTINE  BUDGET  307 

a  total  collection  of  $29,805,651  in  gold  and  |2S,958,460  in 
paper,  or  £11,571,076,  amounted  to  585  per  cent,  of  the 
whole. 

In  1897  the  budget  voted  by  Congress  increased  the 
general  revenue  to  be  collected  to  $33,492,000  in  gold  and 
117,835,000  in  paper  (deducting  from  this  last  sum  12  millions 
of  paper  produced  by  the  shares  of  the  National  Bank  and 
2  millions  as  the  profits  of  the  Bank  of  the  Nation),  or  in  all 
Sl48,000,000,  The  yield  of  internal  duties  had  increased  to 
819,360,000,  or  13  per  cent,  of  the  whole  revenue. 

In  1908  the  domestic  imposts  produced  £4,000,000,  or  17 
per  cent,  of  a  total  collection  of  £22,400,000.  The  chief  element 
of  this  revenue  was  furnished  by  the  duty  on  the  consumption 
of  alcohol,  which  produced  £1,496,000.  The  tobacco  duty 
came  second  with  a  yield  of  £1,760,000.  Matches  yielded 
£269,000;  beer,  £308,000  ;  insurances,  £61,600.  These  figures 
sliow  how  rapid  has  been  the  increase  of  the  revenue  from 
internal  duties  on  consumption. 

If  we  disregard  that  portion  of  the  revenue  which  is 
raised  by  imposts,  and  examine  the  yield  of  the  industrial 
undertakings  exploited  by  the  nation,  we  shall  find  that  as 
yet  they  are  far  from  constituting  any  real  resource  for  the 
Treasury,  and  far  from  compensating  the  large  amounts  of 
capital  employed.  Comparing  the  yield  of  these  undertakings 
with  the  working  expenses,  we  find  that  the  balance,  as  a 
general  thing,  is  on  the  losing  side. 

This  is  the  case  with  the  four  railways  belonging  to  the 
nation,  whose  yield,  in  1905,  was  £1,012,000.  The  working 
expenses,  the  renewal  of  rolling-stock,  and  repairs  of  the  per- 
manent way,  completely  absorbed  the  revenue.  We  must 
hope  that  this  ruinous  state  of  things  will  disappear  presently, 
when  the  network  of  State  railways  is  completed,  and  the 
lines  unite  important  centres  of  production,  and  the  system 
of  administration  is  perfected. 

After  this  miserable  result  we  may  point  with  relative 
satisfaction  to  another  important  industrial  undertaking  of 
the  Government :  the  sanitation  works  of  the  city  of  Buenos 
Ayres.  Apart  from  the  hygienic  advantage,  which  is  already 
very  evident,  the  financial  results  are  worthy  of  attention,  as 
they  show  that  this  undertaking  will  very  shortly  cover,  if 


308    THE  ARGENTINE  TN  THE  20th  CENTURY 

not  the  whole,  at  least  a  portion  of  the  interest  on  the  capital 
employed. 

The  ordinary  working  expenses  of  this  undertaking 
amounted  in  1908  to  £258,202,  while  the  revenue  amounted 
to  £673,200.  This  left  a  balance  in  favour  of  the  Treasury 
of  £415,000,  of  which  a  great  part  was  employed,  by  virtue 
of  special  laws,  in  the  enlargement  of  these  works,  which 
enlargement  will  still  further  increase  the  revenue.  The 
financial  result  of  this  undertaking  is  a  conclusive  proof  that 
such  euterprises,  when  directed  with  method  and  intelligence, 
are  always  profitable  to  the  State. 

The  Postal  Service,  which  the  authors  of  the  Constitution 
expected  to  be  a  considerable  resource,  has  hitherto  given 
only  negative  results ;  the  receipts  have  not  hitherto  covered 
the  working  expenses.  The  ordinary  expenses  of  the  Depart- 
ment of  Posts  and  Telegraphs  were  £1,144,000  in  1908,  while 
the  efiective  receipts  for  the  same  year' were  only  £936,820; 
giving  a  deficit  of  £207,680.  In  reality  this  deficit  was  far 
greater,  because  fresh  expenditure  was  necessitated  by  the 
construction  and  repairs  of  telegraphic  lines,  and  certain 
purely  nominal  receipts,  arising  from  the  franking  of  ofiicial 
correspondence,  were  put  on  the  credit  account. 

If  we  now  proceed  to  examine  the  revenue  derived  from 
the  national  estates,  we  find  that  its  most  important  item  pro- 
ceeds from  the  sale  and  allocation  of  the  public  lands.  This 
revenue,  which  figures  among  those  enumerated  by  the  funda- 
mental charter  as  forming  the  resources  of  the  Treasury,  has 
by  no  means  produced  what  it  should,  owing  to  the  lack  of 
method  or  foresight  in  the  management  of  this  important 
administrative  department.  In  1908  this  source  produced  i 
only  £278,080  ;  and  this  sum  represents  a  considerable  increase  ( 
over  previous  years,  especially  over  the  year  1904,  when  the  j 
revenue  was  only  £27,368.  But  when  we  take  the  fact  into  j 
account  that  the  nation  still  possesses  212  millions  of  acres  j 
of  land,  which  are  situated  in  territories  whose  population  is 
rapidly  increasing,  and  which  will  shortly  be  well  served  with  { 
railways,  we  perceive  at  once  that  these  lands,  which  are  a  j 
powerful  source  of  attraction  to  immigrants,  may  also  in  time  { 
become  a  very  important  source  of  revenue. 

The  revenue  derived  from  the  exploitation  of  industrial 


THE  ARGENTINE  BUDGET  309 

undertakings  and  from  the  national  domains  being  thus 
eliminated  from  the  list  of  effective  revenues,  as  being 
nominal  or  insignificant,  we  see  that  the  nation  has  no  other 
positive  resources  than  the  customs  duties  and  imposts  upon 
consumption.  This  explains  the  development  of  the  budgets 
of  the  last  few  years,  in  which  the  domestic  and  indirect 
duties  have  increased  the  fiscal  receipts.* 

One  of  the  characteristics  of  the  present  situation  of  the 
Argentine  is  the  remarkable  elasticity-  displayed  by  the 
increase  of  the  fiscal  resources.  At  the  present  time  few 
countries  in  the  world  present  a  similar  spectacle.  Here, 
more  than  in  any  other  country,  the  official  revenues  are  in 
direct  relation  to  the  result  of  the  harvests  and  the  exporta- 
tion of  the  products  of  the  ranch ;  so  that  the  table  of  fiscal 
receipts  is  a  kind  of  infallible  barometer,  which  measures 
the  degree  of  wealth  and  prosperity  of  the  general  popu- 
lation. 

If — not  to  go  back  too  far  in  our  investigations — we  take 
the  thirteen  years  from  1895  to  1908  as  an  example,  and  if 
we  convert  into  gold  the  sums  received  in  paper,  according 
to  the  average  rate  of  exchange  for  each  of  these  years,  we 
find,  in  the  first  place,  that  in  1895  the  Treasury  received 
£7.600,000.  Since  then  these  figures  have  increased  in 
rapid  progression  ;  passing  from  £7,600,000  to  £8,600,000 ; 
thence  to  £10,000,000;  thence  to  £10,600,000;  thence  to 
£14,600,000;  but  in  1900,  through  economic  causes  such  as 
the  loss  of  harvests,  anthrax,  the  closing  of  English  ports 
to  Argentine  live-stock,  joined  to  such  political  causes  as 
the  fear  of  complications  with  Chili,  the  revenues  fell  to 
£13,000,000.  But  progress  was  not  long  in  establishing  itself 
anew;  in  1904,  the  revenue  was  £15,200,000;  in  1907, 
£21,200,000  ;  and  in  1908,  £22,400,000,  which  is  the  highest 
figure  the  administration  has  ever  known. 

To  appreciate  this  enormous  progress  at  its  true  worth,  we 
must  take  the  fact  into  account  that  it  was  precisely  during 
these  years  that  the  nation  released  several  sources  of 
revenue  which  had  previously  been  taxed  ;  such  as  duties 
levied  on  the  export  of  natural  products,  and  on  natural  or 
artificial  wines,  and  additional  duties  levied  on  importations, 

*  See  Memoria  del  Ministerio  de  Hacienda,  1895,  Vols.  IX.  and  XI. 


310    THE  ARGENTINE  IN  THE  20th  CENTURY 

all  of  which  represented  a  respectable  number  of  millions  per 
annum. 

Thus  in  thirteen  years,  from  1895  to  1908,  the  fiscal 
receipts  have  increased  by  £14,800,000,  or  by  194  per  cent. 

Such  a  result  cannot  but  be  satisfying,  and  it  would  be 
the  most  eloquent  proof  of  the  intense  vitality  of  the 
Argentine  finances  were  it  not  for  the  still  more  rapid 
increase  of  oflficial  expenditure.  This  also  has  increased, 
rapidly  and  enormously,  more  often  than  not  exceeding  the 
revenue,  and  leaving  each  year  a  more  or  less  important 
deficit,  which,  accumulating  from  one  year  to  another,  has 
finally  to  be  converted  into  a  consolidated  debt,  whether 
foreign  or  domestic.  "  The  practical  result  of  the  budgets 
from  1863  to  the  present  time,"  says  an  official  document, 
"  has  been  an  uninterrupted  series  of  deficits.* 

In  the  face  of  this  situation  the  patriotic  advice  which  the 
Minister  of  Finance,  J.  M.  Rosa,  gave  the  Government  and 
the  Congress  in  a  memorable  document  some  years  ago,  is 
more  than  ever  applicable. 

"  We  must  do  our  utmost  to  economise,"  he  said,  "  by 
restraining  ourselves  and  reducing  our  expenses  to  the 
absolutely  indispensable.  It  is  only  by  applying  ourselves 
to  the  work  of  simplifying  our  administrative  services,  by 
suppressing  useless  formalities  and  superfluous  employments, 
by  scrutinising  the  least  details  of  the  public  expenditure,  that 
we  shall  succeed  in  making  large  economies.  It  is  certain 
that  to  purge  the  administration  of  its  ancient  vices,  to 
sweep  away  all  useless  appointments,  to  refuse  to  find 
vacant  places  at  the  bidding  of  power  and  influence,  and  to 
establish  the  strictest  rules  of  economy,  is  a  task  of  no  mean 
difficulty  ;  but  we  cannot  stop  to  think  of  the  animosity  and 
the  vindictive  temper  which  it  may  arouse  when  duty  renders 
such  conduct  necessary."  * 

If  Argentina  truly  wishes,  not  to  compromise  her  lofty 
destinies,  but  to  remain  a  centre  of  attraction  to  the 
labourers  or  the  disinherited  children  of  fate  to  whom  she 
offers  the  resources  of  her  fruitful  soil ;  if  she  aspires  to  be, 
in  the  twentieth  century,  the  great  centre  of  the  world's 
emigration,   as  were  the    United  States   in   the  nineteenth 

*  See  Memoria  del  Departamento  de  Hacienda  de  1899,  by  Joseph  M.  Rosa, 


THE  ARGENTINE  BUDGET  311 

century,  she  must  obtain  an  administration  both  methodical 
and  economical  ;  careful  of  the  public  moneys,  and  at  the 
same  time  open  to  all  material  progress.  It  is  thus  that  she 
will  win  the  confidence  of  men  and  of  capital  ;  that  is,  of  the 
two  elements  which  she  must  still  multiply  in  order  to 
become  a  great  nation. 


CHAPTER  II 

THE   PUBLIC    DEBT 

Statistics  of  the  public  debt  on  the  Ist  January  1909 — History  of  the  public 
debt — The  first  loans. 

The  financial  crisis — Consolidated  loans — The  Eomero  arrangement — Loan 
for  the  rescission  of  guarantees— The  internal  public  debt — The  total  of 
the  Argentine  public  debt,  and  its  annual  cost  in  dividends  and  redemption 
— The  proportion  of  financial  charges  as  compared  to  other  budgetary 
expenses. 

The  burden  of  the  public  debt  is  heavy,  but  not  unduly  heavy  in  relation  to  the 
productive  power  of  the  country — The  necessity  of  restraining  further 
issues  and  of  converting  old  debts — The  efforts  of  the  Argentine  to  improve 
her  credit. 

ALL  the  vicissitudes  through  which  the  Argentine  has  passed 
in  the  course  of  the  nineteenth  century  have  left  their 
traces  upon  the  history  of  the  National  Debt.  To  the  legitimate 
uses  of  credit  have  been  joined  abuses ;  but  all  this  now 
belongs  to  the  past,  and  we  do  not  intend,  in  a  book  dealing 
with  matters  as  they  are,  to  recount  this  history  at  length, 
nor  to  comment  upon  it  nor  criticise  it. 

The  consolidated  National  Debt,  on  the  1st  July 
1909,  amounted  to  £62.892,428.  It  may  be  analysed  as 
follows : — 

Foreign  Debt.* 


Annual  Cost, 

Interest 

and  Amortisatioa. 


Circulation 
on  ist  January  1909. 

£  £ 

Loans  at  5  per  cent.         ...     23.3r)0,139-76  1,702,585-29 

Loans  at  4^  per  cent.       ...       7,697, 2t;2-8R  516.147-42 

Loans  at  4  per  cent.         ...     29,820,31279  1,454,465-64 

Loans  at  3^  per  cent.       ...       2,004,710-40  121,238-09 


Total £62,882,425-83  £3,794,436-44 

In  the  total  given  above  is  an  important  sum  of  which  the 
cost,  though  entered  in  the  National  Budget,  is  really  borne  by 
the  various  provinces.     Items  in  this  amount  are  a  sum  of 

♦  By  15th  September  1909,  the  amount  of  the  debt  had  been  reduced  to  the 
following  figures:  5  por  cent.,  £22,702,330;  4|  per  cent.,  £7,579,580:  4  per 
cent.,  £29,728,562;  3  per  cent.,  £1,920,000  ;  total,  £61,930,472. 
312 


THE  PUBLIC  DEBT  313 

£6,800,000,  for  which  the  Province  of  Buenos  Ayres  is  respon- 
sible ;  the  £3,000,000  of  the  conversion  loan  of  Santa  Fe  ; 
£2,800,000  taken  up  by  Eiitre  Rios ;  and  the  Cdrdoba  eon- 
version  loan  of  £1,000,000 ;  while  Mendoza  accounts  for 
£600,000  and  the  National  Bank  in  liquidation,  for  £1 ,800,000. 
This  establishment,  although  belonging  to  the  Government, 
bears  the  cost  of  its  debt  out  of  its  own  resources.  Elimi- 
nating these  £16,000,000,  we  find  that  the  external  debt, 
whose  cost  is  borne  by  the  Treasury,  amounts  not  to  nearly 
£63,000,000,  but  to  £47,000,000. 

We  shall  ultimately  have  occasion  to  inquire  how  far  this  debt 
weighs  upon  the  resources  of  the  Treasury,  what  the  burden  per 
inhabitant  amounts  to,and  how  it  stands  in  relation  to  the  debts 
of  other  countries.  For  the  moment  we  must  glance  backward 
in  order  to  realise  the  historical  conditions  under  which  this 
debt  was  contracted,  and  what  its  destination  has  been.*  The 
first  credit  transaction  effected  by  the  Republic  al.u'oad  was  con- 
cluded a  few  years  after  the  Declaration  of  Independence.  In 
1822  the  Province  of  Buenos  Ayres,  which  had  always  been  the 
heart  and  head  of  the  Republic,  taking  its  place,  indeed,  under 
certain  conditions,  and  under  others  representing  it  in  foreign 
countries,  was  fortunate  in  having  at  its  head  a  progressive 
Government,  which,  by  its  profitable  initiative, has  left  ineradi- 
cable traces  behind  it.  The  President  was  General  Martino 
Rodriguez ;  the  Ministers  included  Bernadino  Kivadavia  and 
Manuelo-Josepho  Garcia. 

This  Government  cast  its  eyes  over  the  empty  surface  of  the 
vast  Argentine  territory  ;  it  saw  immense  wealth  unexploited, 
for  lack  of  the  necessary  elements  ;  it  realised  its  great  need  of 
material  progress,  and  understood,  with  a  just  and  clairvoyant 
judgment,  that  of  all  these  needs  the  most  urgent  were  the  con- 
struction of  a  port  for  the  exchange  of  products  with  the  outside 
world,  the  instalment  of  a  water  supply  which  would  ensure 
health  to  the  inhabitants,  and  the  establishment  of  villages 
along  the  line  of  the  new  frontier,  serving  as  desert  outposts, 
and  constituting  a  military  pale  to  withstand  and  confine 
the  irruptions  of  the  savage  Indians. 

*  See,  in  T/f  North  AmeTicnn  Review  for  May  1902.  an  article  by  SeCor 
-\lberto  Martinez,  entitled:  "National  Debts  of  the  World.  IX.  Public  Debt 
of  Argeutiua.' 


m 


3U    THE  ARGENTINE  IN  THE  20th  CENTURY 

For  the  realisation  of  these  then  important  undertakings  ;U^  , 
of  public  utility  the  Government  of  1822  resolved  to  obtain  irifiP'"^!'' 
the  necessary  resources,  by  raising  a  loan  of  a  million  0^fli 
sterling,  giving  as  consideration  a  dividend  of  6  per  cent.  i£'2r' 
and  an  annual  redemption  of  1  per  cent. ;  the  House  of  "^^ ' 
Baring  to  act  as  agents  for  the  loan.  Unhappily  the  i  ^^  ^ 
executive  power  employed  the  resources  furnished  by  this  j  ^^^ 
transaction  in  founding  a  bank  which  had  a  very  short  i  i 
existence,  and  the  intended  public  works  were  not  effected.  ]  i 
More  than  half  a  century  elapsed  before  their  realisation.  ' 

Tlie  loan  was  issued  in  1824,  and  was  taken  up  in  entirety 
at  a  discount  of  30  per  cent.,  so  that  the  Government 
received  £700,000.  For  many  years,  at  the  time  of  the 
Rozas  tyranny,  and  during  the  ensuing  period  of  national  ■■ 
dissolution,  the  payments  on  this  loan  were  suspended  ;  not 
until  1856,  when  the  tyranny  was  overthrown  and  the 
Argentine  nation  reconstituted,  did  the  Government  of 
Buenos  Ayres  instruct  Norberto  de  la  Riestra  to  come  to  an 
understanding  with  the  creditors,  and  to  offer  them  the 
punctual  payment  not  only  of  the  future  dividends,  as  they 
fell  due,  but  also  of  all  those  overdue,  on  deferred  stock  at 
lis.  2d.,  at  2  per  cent,  interest,  with  an  annual  redemption 
of  I  per  cent.  This  debt  is  to-day  extinguished,  and  has  left  j 
no  traces  on  the  budget.  j 

The   second   loan   contracted    by   the    nation    after    its   I 
reorganisation  was  intended  to   cover  the   expenses  of  the   i 
war   to   which   it   had  been  unreasonably  provoked  by  the 
tyrant  of   Paraguay  in   1865 ;   and  this  loan  has   also   dis- 
appeared from  the  ledger  of  the  public  debt.  , 

The  third  national  loan  was  contracted  in  1870,  the  sum  I 
being  £1,042,978,  under  the  Presidency  of  Senor  Sarmiento;  \ 
and  the  capital  was  required  for  the  accomplishment  of  ! 
public  works.  This  loan  and  that  preceding  it  were  finally  I 
converted  into  others  which  carried  a  lower  interest.  j 

Then  these  transactions  were  followed  by  others,  of  which  j 
we  will  briefly  enumerate  the  details.  i 

The  railway  loan,  authorised  by  the  law  of  the  2nd  of  ; 
October  1880,  was  to  raise  the  sum  of  $12,000,000  ;  a  sum  i; 
required  for  the  extension  of  the  Central  North  Railway  as  ' 
far  as  the  town  of  Jujuy,  the  Andean  line  as  far  as  San  Juan, 


THE  PUBLIC  DEBT  315 

and  for  the  branch  line  to  Santiago  de  I'Estero.  It  bore 
G  per  cent,  interest,  with  an  annual  redemption  of  1  per  cent. 
It  was  issued  in  London,  in  June  1881,  for  the  amount  of 

(£2,450,000,  at  a  price  of  91  per  cent. 
The  loan  entitled  "  The  Public  National  Funds,"  which 
was  decreed  by  the  laws  of  12th  October  and  28th  June  1883, 
I  enabled  the  Government  to  pay  for  the  shares  in  the  National 
I  Bank  (to-day  in  liquidation),  which  it  had  acquired.     This 
loan,  bearing-  5  per  cent,  interest  and  1  per  cent,  redeniption, 
was  issued  in  May  1884,  by  Baring  Brothers,  at  a  discount 
(if  84'5  per  cent.,  and  amounted  to  £1,683,100. 

The  loan  entitled  "  Harbour  Works  of  the  Capital," 
authorised  by  the  law  of  27th  October  1882,  was  contracted 
tor  the  construction  of  the  new  harbour  which  the  city  of 
Buenos  Ayres  required  for  the  development  of  her  foreign 
trade.  An  issue  of  $20,000,000  in  gold  was  decreed,  bearing 
C  per  cent,  interest,  with  1  per  cent,  redemption. 

The  "Public  Works"  loan  was  created  by  the  law  of 
21st  October  1885 ;  its  amount  was  £8,400,000,  and  its  object 
the  unification  of  certain  loans  required  for  various  under- 
takings. The  shares  bore  5  per  cent,  interest  with  an 
annual  redemption  of  1  per  cent.  The  sum  issued  was 
£8,333,000,  of  which  £4,000,000  was  placed  in  London,  in 
January  1886,  at  80  per  cent.,  and  the  remainder  in  January 
1887  at  85|  per  cent.  This  loan  was  guaranteed,  as  far 
as  the  interest  was  concerned,  by  the  customs  revenue,  and 
the  representatives  of  the  investors  had  on  this  pretext 
reserved  certain  rights  of  control  over  the  administration  of 
this  revenue. 

The  "  Central  Northern  Eailway  Loan  "  was  divided  into 
I  two  series.  The  first,  authorised  by  the  law  of  9th  October 
1886,  was  of  £4,000,000 ;  but  of  this  sum  only  £3,968,200 
was  issued,  as  follows  :  to  London,  in  June  1887,  £1,300,000 
at  91-5  per  cent.;  in  April  1888,  £1,500,000  at  94  per  cent. ; 
in  May  1889,  £1,168,200  at  97  per  cent.  The  second  series, 
authorised  by  the  law  of  30th  October  1889,  amounted  in  all 
to  £3,000,000,  of  which  only  £2,976,000  was  issued.  The 
two  loans  bore  an  interest  of  5  per  cent,  and  a  redemption  of 
1  per  cent.;  they  were  contracted  to  allow  of  the  prolongation 
of  the  Central  Northern  Railway. 


316    THE  ARGENTINE  IN  THE  20th  CENTURY 

yr  The  "  National  Bank  "  loan,  created  in  virtue  of  the  law 
of  2nd  December  1886,  authorised  an  issue  of  £2,058,200, 
to  enable  the  Government  to  pay  the  debt  which  it  had 
contracted  towards  the  said  Bank.  The  bonds  were  issued 
at  90  per  cent.  ;  they  bore  an  annual  interest  of  5  per  cent., 
with  a  redemption  of  1  per  cent. 

The  "  Treasury  Bonds  Conversion "  loan,  authorised  by 
the  law  of  21st  June  1887,  was  employed,  as  its  descrip- 
tion indicates,  in  the  consolidation  of  a  debt  contracted  for 
a  short  term.  The  issue  required  was  $5,078,330  paper,  but 
only  £624,000  was  actually  realised.*  The  stock  carried 
an  aunual  revenue  of  5  per  cent.,  with  1  per  cent,  redemption, 
while  the  old  Treasury  Bonds  have  an  interest  of  9  per  cent. 

The  loan  contracted  by  virtue  of  the  law  of  15th  August 
1887  was  intended  to  balance  certain  debts  on  the  part 
of  the  National  Government  towards  the  Government  of  the 
Province  of  Buenos  Ayres.  The  issue  was  one  of  £3,973,700, 
the  interest  being  4|^  per  cent,  and  the  redemption  1  per 
cent. ;  it  was  taken  up  at  90  per  cent. 

The  "  Conversion  of  Debts  "  loan,  at  6  per  cent.,  contracted 
in  virtue  of  the  law  of  2nd  August  1888,  was  an  opera- 
tion of  consolidation  and  reorganisation  of  debts.  The  issue 
amounted  to  £5,290,000.  The  bonds,  which  yielded  4|  per 
cent.,  with  1  per  cent,  redemption,  were  negotiated  in  London, 
in  February  1889,  at  90  per  cent. 

The  "  Conversion  of  Hard  Dollars "  loan  was  issued  in 
virtue  of  the  law  of  2nd  July  1889,  which  authorised  an 
issue  of  £2,600,000  to  be  applied  to  the  conversion  of  debts 
contracted  in  hard  piastres.  The  new  stock  was  to  yield 
an  interest  of  3|  per  cent.,  with  1  per  cent,  redemption. 
The  issue  actually  amounted  to  £2,659,500. 

The  "  Consolidation  Loan "  (authorised  24th  January 
1891)  was  one  of  the  most  important  credit  transactions  ever 
effected  in  the  Argentine  Republic :  a  transaction  which 
evokes  memories  of  a  critical  period  which  we  ought  briefly 
to  recall. 

When  Signor  Pellegrini's  Government  came  to  power,  on 
the   6th   August  1890,  the   country  was   suffering   from    a 

*  The  sum  of  $5,076,330  is  equivalent  at  the  present  discount  of  paper  to 
£446,873  ;  in  1887  the  value  of  the  paper  piastre  was  higher.— [Tkans.] 


I 


THE  PUBLIC  DEBT  317 

political  upheaval,  and  at  the  same  time  was  entering  upon 
a  time  of  severe  financial  crisis,  "  the  most  violent,  the  most 
desperate  crisis  which  has  ever  aflflicted  the  Republic,  and  put 
its  honour  to  the  test,"  according  to  the  words  of  Vincenzio 
Lopez,  the  eminent  (inance  Minister  of  that  administration. 

The  Treasury  had  exhausted  its  resources,  in  order  to 
increase  and  support  the  funds  of  the  National  Bank,  whose 
debt  to  the  Government  amounted  to  $47,491,483  *  in  paper, 
and  £2,528,224  in  gold,  while  its  debt  to  foreign  creditors 
amounted  to  £3,708,037,  and  to  home  creditors  £2,328,800. 

If  the  situation  of  the  National  Bank,  which  served  as 
the  Government's  treasury,  was  serious,  that  of  the  National 
Mortgage  Bank  and  that  of  the  City  of  Buenos  Ayres  were  no 
less  grave.  The  first  owed  $1,690,833  in  paper  and  £111,475 
in  gold  in  dividends,  and  the  second  was  drained  dry  by  its 
debts,  amounting  to  $34,646,533  paper  and  £92,339  gold  at 
home,  as  well  as  £1,960,000  abroad. 

From  the  outset  the  Government  concentrated  all  its 
efforts  upon  the  solution  of  these  three  grave  problems.  It 
proposed  the  reconstitution  of  the  National  Bank  ;  it  would 
enable  the  Mortgage  Bank  to  continue  operations,  chiefly  by 
repaying  the  advances  which  it  had  made  to  the  State ;  and 
assist  the  City  of  Buenos  Ayres  to  meet  its  engagements 
in  respect  of  the  interest  of  the  foreign  debt,  constraining  it 
to  collect  and  employ  the  municipal  revenues  in  a  more 
methodical  manner. 

The  prime  object  of  this  important  transaction  was  "to 
give  the  country  a  period  of  economic  repose,  by  provisionally 
suspending  the  removals  of  metallic  currency  for  the 
liquidation  of  the  nation's  foreign  engagements,"  as  the 
Government  declared  in  the  message  which  accompanied  its 
proposal.  To  achieve  this  end,  the  creation  of  a  consolidation 
loan  was  proposed,  amounting  to  £12,000,000,  and  increased 
later  on  to  £15,000,000  upon  the  advice  of  the  lenders,  the 
result  being  destined,  for  a  period  of  three  years,  for  employ- 
ment in  paying  the  interest  on  the  nation's  loans  and  in 
relieving  the  Treasury  of  the  burden  of  guaranteeing  the 
dividends  of  the  railways. 

•  This  amount  is  not  reduced  to  gold,  the  rate  of  exchange  not  being  fixed 
at  the  time.— [Teans.] 
X 


318    THE  ARGENTINE  IN  THE  20th  CENTTTRY 

In  accordance  with  agreements  concluded  between  the 
Government  of  the  Republic  and  the  banking  houses  which 
undertook  to  negotiate  the  loan,  the  banks  undertook  to 
accept,  during  a  period  of  three  years,  as  consideration  for 
the  debt,  and  for  the  effectual  guaranteeing  of  the  railways, 
bonds  of  the  loan  itself ;  and  undertook,  moreover,  to  accept 
them  at  par.  The  issue  each  year  was  to  be  proportional 
to  the  sum  necessary  to  pay  the  interest  on  the  debt. 

The  nation,  on  the  other  hand,  undertook  to  set  aside  for 
the  payment  of  the  interest  on  the  said  loan  6  per  cent, 
of  the  customs  receipts,  which  were  subjected  to  a  monthly 
levy  of  the  amount  required,  the  amount  affected  by  the 
prior  rights  of  the  loan  of  1885  being  deducted  first. 

•  The  nation  also  engaged  not  to  increase  its  foreign  debts, 
whether  by  borrowing  or  giving  guarantees,  during  the  three 
years  fixed  for  the  issue  of  the  loan. 

The  total  amount  authorised  was  £15,000,000,  the  interest 
6  per  cent.,  and  redemption  was  to  commence  at  the  end  of 
three  years,  to  be  completed  in  thirty  years.  Coupons  could 
be  paid  to  the  State  in  settlement  of  customs  duties.  Of  the 
above  nominal  sum,  only  £7,691,725  was  actually  raised, 
£7,308,275  remaining  unissued  for  the  following  reasons : — 

Under  the  administration  of  Senor  Saenz  Peiia,  when 
Senor  Romero  was  installed  in  the  Ministry  of  Finance  on 
the  12th  October  1892  he  found  the  Consolidation  Loan  in 
process  of  issue,  the  stock  being  sold  at  need,  the  6  per  cent, 
bonds  being  guaranteed  by  the  customs  receipts  ;  they  were 
then  selling  in  London  at  about  63  per  cent.  Seiaor  Romero 
estimated  that  if  the  system  of  paying  debts  by  means  of 
debts  is  generally  a  ruinous  one,  it  was  especially  so  in  this 
case,  where  the  transaction  was  being  effected  by  means  of 
bonds  so  badly  depreciated  as  those  of  this  loan. 

The  first  important  act  of  this  Presidency  was  to  make 
an  arrangement  with  the  representatives  of  the  bearers  of 
the  foreign  debt,  by  which  they  consented  to  a  reduced 
interest  for  five  years — that  is,  until  1898 — the  redemption 
charge  being  suspended  simultaneously.  In  the  following 
years,  from  12th  July  1898  to  12th  January  1901,  the  full 
interest  alone  was  to  be  resumed,  and  from  1901  the  payment 
of  the  redemption  charge  would  also  be  resumed. 


THE  PUBLIC  DEBT  319 

As  a  consequence  of  this  carrangement,  it  was  decided  to 
issue  no  further  stock  of  the  loan,  even  in  cases  wliere  the 
issue  was  authorised :  as,  for  example,  in  the  effective 
guarantee  of  railway  stock.  Holders  of  the  latter  would 
receive  payment  ou  the  basis  of  the  price  at  which  the  shares 
were  quoted.  This  is  why  the  Consolidation  loan  issue  of 
1891  was  confined  to  the  sura  already  cited. 

The  "  Travaux  de  salubrite,"  or  Water  Supply  and 
Drainage  loan,  authorised  by  the  law  of  30th  January  1891, 
to  the  extent  of  £6,750,000,  in  bonds  bearing  5  per  cent, 
interest  and  1  per  cent,  redemption,  was  created  under  the 
following-  conditions : — 

The  Govei-nment  of  Senor  Juarez  Celman,  which  preceded 
that  of  Signor  Pellegrini,  was  inspired  by  the  Spencerian 
doctrine,  which  asserts  as  a  principle  that  the  State  is  always 
a  bad  administrator,  and  fell  into  financial  and  administrative 
errors  which  were  to  cost  the  country  dear  indeed.  Thus  it 
resolved  to  place  in  the  hands  of  individuals  all  the  industrial 
enterprises  undertaken  by  the  nation,  among  which  was  the 
scheme  for  supplying  the  city  of  Buenos  Ayres  with  water 
and  facilitating  the  elimination  of  its  filth  and  sewage. 

Every  one  very  soon  saw,  however,  that  a  serious  mistake 
had  been  made.  The  individual  firm  entrusted  with  these 
important  services  was  exclusively  preoccupied  in  exploit- 
ing the  public,  and  its  methods  resulted  in  protests  and 
resistance  on  the  part  of  the  inhabitants  of  Buenos  Ayres. 
On  6th  August  1890,  the  Government,  Pellegrini  being 
president,  came  to  the  conclusion  that  it  was  its  duty  as  an 
administration,  and  was  also  a  matter  of  political  efficiency, 
to  place  the  sanitation  works  in  the  hands  of  the  State  once 
more ;  and  with  this  object  it  obtained  an  authorisation  to 
contract  a  loan  of  £6,750,000,  at  5  per  cent,  and  1  per  cent, 
redemption.  Such  was  the  origin  of  this  loan,  of  which 
stock  to  the  value  of  £6,374,995  was  issued. 

The  "  Rescission  of  Railway  Guarantees  "  loan,  authorised 
by  the  laws  of  10th  January  1896  and  30th  December  1898, 
was  contracted  to  disburthen  the  State  of  the  heavy  obliga- 
tions which  weighed  upon  it  as  a  result  of  having  guaranteed 
an  interest  of  6  per  cent,  on  enormous  capitals  employed  in 
the  construction  of  railways.     With  this  object  £11,699,957 


320    THE  ARGENTINE  IN  THE  20th  CENTURY 

worth  of  stock  was  created,  and  issued  at  4  per  cent,  and 
I  per  cent. 

The  loan  for  the  "  Conversion  of  Provincial  Debts," 
created  by  the  law  of  8th  August  1896,  was  justified  by  the 
highest  considerations  of  national  solidarity,  and  of  the 
defence  of  Argentine  credit  abroad. 

The  enormous  debts  contracted  by  the  Provinces,  un- 
authorised and  uncontrolled  by  the  central  power,  quickly 
resulted  in  a  veritable  bankruptcy,  at  the  end  of  a  period 
of  waste  and  folly,  of  unchecked  and  uncalculating  expense. 

The  nation,  which  had  in  no  way  intervened  in  the  matter 
of  these  loans,  and  had  contracted  no  obligations  whatever 
on  their  behalf,  might  strictly  have  refused  to  accept  any 
responsibility  for  such  heavy  liabilities ;  but  it  is  indubitable 
that  the  insolvent  condition  of  the  Provinces  in  the  European 
markets  might  have  aflfected  the  credit  of  the  nation,  the 
latter  being,  in  foreign  eyes,  involved  in  all  these  individual 
failures. 

What  President  Quintana  said  in  his  inaugural  address  on 
the  subject  of  the  peace  of  the  Provinces,  which  is  also  the 
peace  of  the  State,  may  also,  with  no  less  reason,  apply  to 
credit. 

On  the  other  hand,  the  nation  could  not  remain  indifierent 
to  the  precarious  situation  created  by  the  suspension  of 
payment  in  the  Provinces.  As  practically  all  their  revenues 
were  already  pledged,  so  that  they  could  not  pay  interest  on 
their  debts  for  many  years,  the  legal  action  of  their  creditors 
might  fetter  their  administrations,  oppose  serious  obstacles 
to  the  development  of  their  sources  of  wealth  and  production, 
and,  in  short,  inflict  serious  damage  upon  the  entire  country. 

These  very  serious  considerations  decided  the  public 
powers  to  lend  the  Provinces  their  aid,  so  that  the  latter 
might  make  equitable  arrangements  with  their  foreign 
creditors,  and  as  far  as  possible  free  themselves  from  such 
heavy  liabilities. 

These  arrangements  were  for  the  most  part  effected  by 
exchanging  the  4J  per  cent,  stock  of  interior  debt  which  the 
Provinces  promised  against  4  per  cent,  stock  of  the  foreign 
debt,  which  the  nation  remitted  to  the  creditors  of  the 
Provinces. 


THE  PUBLIC  DEBT  321 

The  total  of  these  provincial  debts  amounted  to 
£30,855,190,  and  the  nation,  for  the  complete  liquidation  of 
the  same,  gave  4  per  cent,  stock,  bearing  a  redemption  charge 
of  i  per  cent.,  to  the  value  of  £17,199,899.  The  interest 
and  annual  redemption  charges  of  this  stock  amounted  to 
£773,995. 

On  the  other  hand  the  nation  acquired  by  this  arrange- 
ment 4>h  per  cent,  stock  of  the  loan  known  as  the  Guaranteed 
Banks  loan  to  the  value  of  £9,175,233,  the  interest  and 
redemption  charge  (of  1  per  cent.)  amounting  annually  to 
£504,638.  Adding  to  this  sum  that  of  £232,000,  as  the 
contribution  of  the  Province  of  Buenos  Ay  res,  and  £51,220 
furnished  by  the  Province  of  Entre  Rios,  we  have  a  total  of 
£827,858  annually.  The  exchange  of  the  internal  against 
the  external  debt  thus  produced  a  temporary  profit  of  £53,863 
per  annum ;  we  say  temporary,  because  the  4  per  cent,  stock 
has  a  later  date  of  redemption  than  the  4|-  per  cent. 

The  "Conversion  of  Municipal  Stock"  loan,  authorised 
by  the  laws  of  25th  September  1897  and  15th  December 
1898,  was  raised,  to  the  extent  of  £1,540,000,  by  the 
issue  of  stock  at  4  per  cent,  and  |  per  cent.  The  result  of 
this  issue  was  destined  to  pay  what  still  remained  owing  to 
the  creditors  of  the  National  Bank  in  liquidation. 

The  law  of  5th  January  1899  authorised  a  loan  of 
£6,000,000,  intended  to  balance  the  debts  of  the  Public 
Treasury;  the  alcohol  duty  being  offered  as  guarantee  to 
the  extent  of  £800,000  per  annum  ;  but  hitherto  the  loan 
has  not  been  negotiated,  and  there  is  no  longer  any  question 
of  this  issue. 

Such,  briefly  detailed,  are  the  antecedents  of  the  various 
foreign  loans  contracted  by  the  Argentine  nation.  As  for 
the  domestic  consolidated  debt  in  1905,  it  was  the  object  of 
a  complete  reorganisation,  so  that  to-day  the  history  of  its 
origins  is  not  of  much  practical  interest.  It  amounted,  on 
1st  January  1909,  to  £7,639,760  in  gold  and  £9,199,581 
in  paper,  of  which  £6,900,000  was  in  gold  and  £7,700,000 
in  paper  in  5  per  cent,  stock,  £710,620  in  gold  in  4i  per  cent, 
stock,  and  £880,000  in  paper  in  6  per  cent,  stock.  This  gives 
us  a  total  (in  gold)  of  £16,839,341,  on  which  the  charge  in 
interest  and  redemption  absorbs  an  annual  sum  of  £1,004,445. 


322    THE  ARGENTINE  IN  THE  20th  CENTURY 
Here  is  the  analysis  of  the  internal  debt : 

Internal  Debt,  1st  January  1909. 

Gold.  Paper. 

Stock  in  Interest  and              Stock  in  Interest  and 

Circulation.  Sinking  Fund.  Circulation.  Sinking  Fund. 

6  per  cent,  loan,         —  —  £880,000  £58,080 

5  per  cent,  loan,  £6,929,140  £422,100  18,908,140  1,110,898 

4^  per  cent,  loan,        710,020  40,750                —  — 

Totals     ...      £7,639,7(50         £462,852      £19,788,140       £1,168,978 


As  we  explained  in  our  first  edition,  the  first  action  of 
the  Government  which  assumed  power  in  October  1904  was 
to  convert  the  various  loans  of  the  internal  debt,  which 
bore  an  interest  of  0  per  cent.,  and  amortisation  charges  of 
6,  4,  3  and  2  per  cent.,  into  one  single  loan  at  5  per  cent.,  with 
a  redemption  charge  of  1  per  cent.  This  operation  gave  the 
following  results :  The  amount  of  6  per  cent,  stock,  including 
National  Bank  stock,  amounted  to  £5,888,881,  or  $66,918,300 
paper.  Of  this  total  $50,814,000,  or  £4,471,632  were  converted 
in  the  Argentine  and  £664,884  in  Europe,  or  in  all  £5,136,516  : 
the  balance  then  amounting  only  to  £730,184.  The  result 
was  that  the  average  price  obtained  for  converted  stock  was 
87*59  per  cent.,  and  for  unconverted  stock  12-40  per  cent.* 

*  The  following  figures  relative  to  the  Argentine  foreign  loans  taken  from 
the  Investment  Handbook  of  the  International  Stock  Exchange,  may  interest 
the  reader. — [Tkans.] 

Argentine  5  per  cent.  Stock  (1886-7):  Authorised,  £8,290,100:  issued  or 
subscribed,  £6,30(5,500.     Price  on  1st  January  1910,  105^. 

Argentine  4^  Sterling  Loan  (1888-9):  Authorised,  £5,263,560;  issued, 
£4,322,060.     Price  on  1st  January  1910,  100. 

Argentine  3^  per  cent.  External  Bonds  (1889):  Authorised,  £2,639,500; 
issued  £1,923,160.     Price  on  1st  January  1910,  80. 

Argentine  4  per  cent.  Railway  Rescission  (1895)  :  Authorised,  £11,607,100; 
issued  £10,205,100.     Price  on  1st  January  1910,  97^. 

Argentine  4  per  cent.  Gold  Bonds  (1900):  Authorised,  £2,828,515;  issued, 
£2,752,855.     Price  on  Ist  January  1910,  91. 

Argentine  Cedulas,  Series  B.  (1886).  These  are  certificates  to  bearer  issued 
by  the  National  Mortgage  Bank  in  lieu  of  cash  lent  to  borrowers  on  real  estate. 
They  were  first  issued  in  1886,  when  a  total  of  §^0,000,000  was  issued  in  three 
series.  A,  B.  and  C.  They  are  redeemable  by  sinking  funds  of  1  per  cent.,  and 
under  Article  60  of  its  organic  law  the  National  Mortgage  Bank  has  to  add 
to  these  funds  the  sums  in  cash  received  from  its  debtors  on  account  of 
advances  of  capital  or  sale  of  properties.  Cedulas  are  guaranteed  by  the 
nation. 

In   circulation,    31bt   August    1909,    $1,175,250.     Cancelled,    ^13,824,750. 


THE  PUBLIC  DEBT  323 

Although  the  Minister  who  ettected  this  operation,  ex- 
ceeding the  advice  of  competent  persons,  or  rather  defying 
their  judgment,  took  it  upon  himself  to  issue  a  fervent 
panegyric  of  his  transactions  in  an  official  document,  we 
none  the  less  consider  that  the  fundamental  defect  of  this 
conversion  lay  in  having  largely  reduced  the  amortisation 
rate  of  some  of  these  loans,  bringing  them  down  from  6  per 
cent.,  4  per  cent.,  3  per  cent.,  and  2  per  cent.,  to  a  uniform 
rate  of  1  per  cent. ;  as  the  sinking-fund,  as  a  general  thing, 
in  the  case  of  all  financial  administrations,  and  especially 
of  those  of  a  country  without  any  great  experience  of  govern- 
ment, is  a  restraining  factor,  a  limit  which  Governments 
and  Parliaments  impose  upon  themselves,  in  order  not  to 
spend  all  they  collect.  Without  this  money-box,  this  "  woollen 
stocking"  of  Governmental  savings,  as  M.  Neymarck  called 
it,  it  is  certain  that  there  would  be  no  trace  in  the  Argentine 
Treasury  of  all  the  millions  it  has  paid  in  amortisation  during 
the  last  few  years;  so  that  the  present  generation  would 
have  cast  upon  the  shoulders  of  the  coming  generation  a  far 
heavier  burden  than  that  the  latter  will  inherit  as  things 
are. 

Returning  to  the  external  debt,  we  may  state  that  among 
the  loans  which  figure  in  the  national  liabilities  are  eight, 
with  a  capital  of  £23,350,139,  at  5  per  cent,  interest;  two, 
with  a  capital  of  £7,697,263,  at  4^  per  cent. ;  eleven  with 
a  capital  of  £29,840,315,  at  4  per  cent.,  and  one  of  £2,004,710 
at  3i  per  cent. 

The  public  debt,  external  and  internal,  amounts  to  the 
following : — 

Esterual  debt         ,£62,802,428 

Internal  debt  16,8:«,365 


£79,7:51,793 


Interest,  7  per  cent.  Prices  have  varied  from  24^  to  48f .  Price  on  Ist  January 
1910,  44^. 

Buenos  Ayres  Water  Supply  and  Drainage  Bonds  (1892).  Authorised, 
£6,324.400.  Present  amount,  £5,620,820.  The  operation  of  the  Sinking 
Fund  in  January  1910  will  further  reduce  this  amount.  Prices  have  varied 
from  52g  to  106.     Price  on  1st  January  1910,  106. 

Buenos  Ayres  Sterling  Bond  3  to  oj  per  cent.  Authorised,  £10,296,000; 
issued,  £9,796,000.     Price  on  Ist  Janu^xry  1910,  C9^. 


324    THE  ARGENTINE  IN  THE  20th  CENTURY 

Let  us  see  to  what  extent  the  interest  on  this  debt 
weighs  upon  the  Budget : — 

External  debt £3,794,436 

Internal  debt 1,004,445 

Total  on  let  Jannary  1909    ...         £4,798,881 

In  the  tabulation  of  the  foreign  debt  we  have  not  included 
the  new  loan  of  £10,000,000,  the  stock  being  known  as 
"  Argentine  Internal  Credit,  1909,"  bearing  5  per  cent,  iuterest 
and  a  1  per  cent,  consolidated  sinking  fund,  which  the  national 
Government  has  just  raised  in  Europe.  This  loan,  which  was 
readily  taken  up,  was  divided  in  the  following  proportions  : 
England,  £2,960,000 ;  France,  £3,200,000  ;  the  United  States, 
£2,000,000;  Germany,  £1,640,000. 

Taking  this  new  loan  into  account  the  total  of  the 
external  debt  is  £72,892,428. 

The  various  amounts  of  interest  payable  on  the  whole 
National  Debt,  external  and  internal,  converted  into  gold 
at  the  rate  of  4s.  per  piastre,  represent  a  total  of  £4,778,882. 
As  we  have  stated  before,  this  burden  does  not  weigh  ex- 
clusively on  the  Treasury ;  we  must  deduct  from  it  the 
interest  paid  by  the  Provinces  and  the  National  Bank,  or, 
a  sum  of  £687,628,  so  that  the  interest  paid  by  the  nation 
amounts  in  fact  to  £4,111,253.  Comparing  this  figure 
with  the  total  of  the  general  budget,  we  find  that  the 
interest  on  the  National  Debt  amounts  to  25*34  per  cent, 
of  the  total  expenditure,  of  which  22-3  per  cent,  weighs 
exclusively  on  the  nation.  Finally,  we  must  not  forget 
that  large  sums  included  in  the  budget  are  paid  into  the 
sinking  fund  at  a  rate  which  should  rapidly  decrease  the 
debt ;  a  factor  which  evidently  must  be  reckoned  as  a 
compensation. 

In  the  face  of  this  enormous  debt  are  we  to  conclude, 
with  certain  authors  of  repute,  that  when  the  payment 
of  the  interest  on  the  public  debt  absorbs  more  than  40  per 
cent,  of  a  nation's  revenue,  that  nation  is  in  the  most  serious 
situation,  not  far  removed  from  bankruptcy  ? 

Certainly  the  theories  of  these  gentlemen  are  based  upon 
valuable  data,  which  are  deduced  from  the  science  of 
finance,   or    taken   from    the    actual    examples    of    certain 


THE  PUBLIC  DEBT  326 

nations;  but  it  is  also  certain  that  these  theories  have 
been  formiihited  with  the  mind  directed  toward  European 
countries,  in  which  population,  wealth,  and  all  the  phenomena 
of  social  life  are  evolved  in  a  slow  and  harmonious  manner ; 
but  for  countries  like  the  Argentine,  countries  with  enormous 
natural  resources,  subject  to  sudden  increases  of  wealth  and 
population,  where  all  manifestations  of  progress  are  abrupt, 
such  theories  are  not  true. 

Again,  in  order  to  estimate  justly  the  extent  to  which  this 
debt  weighs  upon  the  nation,  we  must  take  account  of  the 
special  conditions  under  which  this  debt  was  created ;  a 
factor  which  makes  international  comparisons  difficult.  It  is 
not  enough  to  know  only  the  total  of  the  National  Debt  in 
order  to  comprehend  the  financial  position  of  a  State  ;  for  it 
may  well  happen,  as  in  the  case  of  Australia,  that  the  capital 
of  the  loans  forming  the  debt  has  been  employed  in  pro- 
ductive work,  the  yield  of  which  contributes  to  increase  the 
Treasury  receipts. 

Neither  can  the  amount  of  debt  per  inhabitant  give  us  a 
true  idea  of  the  financial  vitality  of  a  country ;  for  just  as  a 
given  burden  may  crush  one  man,  while  another  can  bear  it 
with  ease,  so,  according  to  the  physical  resources  of  either, 
one  nation  may  support  a  debt  with  ease  which  would  utterly 
overcome  another.* 

The  weight  of  the  National  Debt  must  be  estimated  by  its 
relations  with  the  economic  system  and  the  conditions  of 
national  development.  For  example,  in  making  such  an 
estimate  with  regard  to  the  Argentine  debt,  we  find  that  side 
by  side  with  the  increase  of  this  debt  there  is  a  notable 
increase   of    the   national    wealth,   which    should    keep  all 

•  M.  Alfred  Neymarck  has  shown  how  broken  a  reed  is  any  argument 
based  upon  the  amount  of  debt  per  inhabitant,  and  how  void  of  any  scientific 
basis. 

"We  have  succeBsively  passed  in  review  the  various  countries  of  Europe, 
and  by  basing  our  arguments  upon  facts  and  exact  figures  wo  think  we  have 
demonstrated  that  in  the  evaluation  of  a  nation's  credit,  of  the  price  of  its 
stocks  and  their  rate  of  capitalisation,  the  figure  '  per  inhabitant '  has  no  value 
and  no  significance.  Such  statistics,  which  are  more  or  less  used  everywhere, 
in  France  and  abroad,  by  force  of  habit  and  routine,  are  absolutely  incorrect 
and  incomplete  ;  they  have  only  one  sure  result  :  they  infect  the  spirit  of 
judgment  of  those  who  rely  on  them." — In  the  journal  Z,e  Rentier,  for  the  7th, 
I7th,  and  27th  of  September  and  the  7th  of  October  1904. 


326    THE  ARGENTINE  IN  THE  20th  CENTURY 

creditors  tranquil  and  satisfied  as  to  the  liquidation  of  the 
obligations  contracted  towards  them  on  the  part  of  the  State, 
although  these  obligations  might  at  first  sight  appear  out  of   \  f. 
proportion  to  the  means  of  the  State. 

If  we  take,  as  a  mark  of  national  wealth,  the  value  of  jB  (iiiK 
products  exported,  we  have  the  following  figures  to  go  by:  Jiiitei 
between  1890  and  1899  the  value  of  the  Argentine  exports 
rose  from  £20,163,600  to  £36,983,200.     In  1903  it  amounted 
to  £44,000,000 ;  in  1904  to  £52,800,000 ;  in  1905  to  £64,400,000 ; 
in  1906  to  £58,400,000;  in  1907  to  £59,200,000;  and  in  1908^ 
to  £73,200,000. 

Side  by  side  with  the  exportable  products  the  revenues  of  , 
the  nation  have  also  achieved  an  extraordinary  expansion,; 
which  has  enabled  the  Government  to  complete  important  / 
public  works,  to  perfect  its  administration,  to  acquire  and  i 
equip  the  first  fleet  in  South  America,  to  spread  primary  and  i 
secondary  education  through  its  territory,  and  to  push  its  \ 
civilising  agencies  to  the  utmost  limits  of  the  country.  i 

In  1898  the  ordinary  gold  receipts  rose  to  £6,416,440,  j 
while  in  1903  they  amounted  to  £8,879,420,  and  in  1904  to- 
£9,345,708:  but  in  1899  there  existed  additional  importation  i 
duties,  which  are  now  suppressed.  In  1907  the  receipts  ins 
gold  amounted  to  £12,900,000,  and  in  1908  £13,600,000. 

The  same  increase  is  to  be  observed  in  the  receipts  col- 
lected in  paper  money.  In  1898  they  amounted  to  £4,201,495 ; 
in  1903  to  £5,709,749;  and  in  1904  they  rose  to  £6,086,753, 
although  the  duty  on  wine  had  been  removed  during  the 
first  half  of  the  year.  In  1907  these  receipts  amounted  to 
£8,316,000,  and  in  1908  to  £8,756,000;  figures  which  repre- j 
sent  an  enormous  progress.  j 

Thus  a  country  in  which  the  national  resources  and  those  j 
of  the  Exchequer  increase  in  so  rapid  a  progression,  is  evi-  j 
dently  in  a  position  to  support,  without  much  anxiety  asj 
regards  the  future,  the  burden  of  its  National  Debt,  however  j 
enormous  the  latter  might  appear.  i 

But  such  considerations  must  not,  of  course,  incite  the  i 
Administration  to  violate  the  financial  principles  of  method 
and  economy,  nor  lead  it  to  increase  the  public  expenditure 
at  an  unjustifiable  pace,  in  order  to  meet  parasitic  require- 
ments, or  satisfy  electoral  demands.     What  gives  rise  to  such 


THE  PUBLIC  DEBT  327 

Tears  is  that  when  there  is  need  for  works  of  a  certain  degree 
of  importance,  such  as  would  give  a  stimulus  to  the  material 
progress  of  the  country,  or  at  least  to  endow  the  country 
with  new  buildings  and  constructive  works,  the  budget  never 
comes  to  the  rescue,  and  the  end  is  always  an  issue  of 
internal  stock. 

Of  late  years  the  Republic  has  enjoyed  a  pastoral  and 
agricultural  yield  such  as  it  has  never  seen  in  its  economic 
existence.  This  double  yield,  the  result  of  energy  favoured  by 
climate,  was  not  only  remarkable  for  abundance,  but  the  prices 
which  it  commanded  in  the  international  markets  were  the 
highest  that  have  ever  been  known  up  to  the  present.  All 
would  seem  to  indicate  that  in  consequence  of  this  abundance 
the  Argentine  Treasurj^  would  overflow  with  money  ;  that  it 
would  be  in  a  position  to  meet  all  the  current  expenses  of 
administration,  and  also  many  of  the  extraordinary  expenses 
which  are  demanded  by  a  nation  in  process  of  formation  for 
the  stimulation  of  its  material  progress. 

Unhappily  it  has  not  been  so.  The  ordinary  revenue, 
like  the  national  production,  has  exhibited  a  marvellous 
elasticity :  but  in  spite  of  that  it  has  not  been  enough  to 
cover  the  ordinar}^  expenses. 

Turning  from  the  shadows  that  obscure  the  picture  of  the 
financial  and  economic  situation,  we  may,  in  spite  of  all, 
•onclude  that  investors  who  have  placed  their  capital  in 
Argentine  loans  may  be  fully  reassured  that  the  interest 
will  be  scrupulously  forthcoming.  Although  the  majority 
I  if  the  loans  have  been  employed  in  other  ways  than  those 
intended  at  the  time  of  their  issue,  it  is  none  the  less  true 
tliat  by  their  aid  certain  works  of  national  utility  have  been 
effected,  which  could  not  have  been  realised  without  such 
resources.  To  cite  only  two,  let  us  recall  the  fact  that  the 
nation  has  spent  £10,976,304  in  the  construction  of  railways ; 
while  the  Buenos  Ayres  Water  Supply  and  Drainage  Works 
absorbed  £6,530,000. 

Again,  as  the  great  Argentine  financier  Senor  Toincjuist 
has  said,  we  must  not  forget  that  although  the  country 
avoided  a  war  with  Chili  it  was  only  by  allowing  £15,000,000 
to  be  swallowed  up  in  ships  and  armaments  :  and  tliis  was 
done  without  recourse  to  the  outside  world  for  loans,  after 


328    THE  ARGENTINE  IN  THE  20th  CENTURY 

not  less  than  £4,000,000  had  been  absorbed  by  military 
preparations  in  the  interior.  These  sums,  representing  nearly 
a  quarter  of  the  present  debt,  were  spent  to  avoid  a  frat- 
ricidal war,  which  would  have  cost  us  ten  times  as  dearly. 

Apart  from  the  fruitful  application  of  loans,  the  creditors 
of  the  Argentine  must  also  consider  the  sacrifices  made  by 
various  Governments  to  defend  and  uphold  the  financial 
credit  of  the  Republic.  The  service  of  the  first  loan  con- 
tracted by  the  nation — that  of  1824 — was,  as  we  know, 
suspended  during  the  melancholy  period  of  tyranny  and 
national  dissolution ;  but  hardly  was  the  Argentine  family 
reunited,  hardly  was  a  regular  Government  established,  when 
the  latter  hastened  to  resume  the  liquidation  of  the  liabilities 
which  had  been  contracted.  President  Avellaneda,  in  a 
solemn  moment,  has  eloquently  recalled  the  facts  : — 

"  There  is  a  new  nation  in  the  process  of  birth,  possessed 
of  the  sentiment  of  its  own  greatness  ;  either  by  a  puerile 
hallucination  or  by  the  revelation  of  its  destiny.  It  has 
barely  formed  a  Government ;  but  already  it  imagines  vast 
schemes ;  it  asks  and  obtains  money  from  London  ;  for  capital, 
although  she  is  represented  as  hard  and  having  no  bowels  of 
compassion,  knows  often  a  sudden  tenderness  for  dreams. 

"  But  the  dreams  of  this  people  are  quickly  destroyed  : 
then  follows  anarchy,  with  its  long  and  lamentable  lapses 
of  self-knowledge :  anarchy,  into  which  young  societies  fall, 
by  the  very  weakness  of  their  native  elements  ;  until  at  length 
they  are  seized  by  the  iron  hands  of  tyranny,  as  was  indeed 
the  fate  of  Argentina.  And  a  tyranny  that  endured  for 
twenty  years  !  Wretched  nation !  Unhappy  Argentina ! 
Her  voice  was  all  but  dumb,  failing  in  the  depths  of  that 
abyss  !  .  .  . 

"  The  bonds  of  that  debt  were  quoted  on  the  London 
Exchange;  but  in  time  they  were  quoted  no  more,  for  they 
had  at  length  lost  all  value  ;  even  their  name  was  erased.  A 
day  came,  however,  when  the  children  of  Argentina's  creditors 
went  to  search  for  their  bonds  among  forgotten  papers ;  and 
the  bonds  were  redeemed.  For  many  that  was  a  day  of 
legitimate  surprise ;  the  bearers  had  offered  their  paper  to  their 
debtors  at  any  price ;  but  now  they  were  told  that  they 
would  receive  its  written  value.     It  was  enough  for  them 


^^  THE  PUBLIC  DEBT  329 

■'.  '"''i'J  'that  they  should  be  paid  in  future  ;  but  they  w^ere  told  that 
'^goes  gyen  the  arrears  of  interest  and  amortisation  should  be 
arranged  by  means  of  new  stock,  which  was  known  as 
Deferred  Bonds. 
'Creiis,  ;  "When,  among  its  assets,  a  nation  possesses  such  a  trait 
'^^^f;  jinits  life  as  this — a  trait  unique  in  the  financial  history  of 
'  ™Mt  I  the  nations — it  has  the  right  to  hold  its  head  erect,  affirming 
™t     its  honour  and  its  credit." 

Since  that  date,  and  during  thirty-six  years,  the  country 

scrupulously  paid  the  interest  on  its  debt,  until  the  disastrous 

■^'ij-^     year  of  1890,  when,  as  a  result  of  the  financial  and  political 

crisis,  the  most  violent  the  country  had  ever   suffered,  the 

payment  of  the  foreign  debt  began  to  be  a  matter  of  serious 

w  i.      consideration  for  the  Administration.     Many  schemes  were 

proposed  to  help  the  State  tide  over  that  difficult  time  ;  but 

posses-   I  none  of  them  included  the  repudiation   of   the  debt.      The 

api   (  Government  then  at  the  head  of  affairs  accepted  the  most 

It:      onerous   of   these  schemes,  because  it   was   that  which  was 

mr      most  to  the  advantage  of  its  creditors. 

rca:;  The  arrangement  then  decided  on,  known  as  the  Morituri 

owci!  loan,  or  Morgan  loan,  has  been  the  subject  of  severe  criticism  ; 
am  ■  j  but  one  thing  was  not  and  will  not  be  debated,  namely,  the 
I  noble  and  patriotic  intention  which  inspired  the  authors  of 
this  transaction,  and  resolved  them  to  safeguard  the  worthy 
traditions  of  Argentine  credit.  By  respecting  their  foreign 
liabilities  they  served  the  truest  interests  of  their  country, 
and  respected  also  the  spirit  of  the  Constitution,  which 
holds  that  credit,  and  foreign  credit  in  particular,  should  be 
the  great  constitutional  resource,  placed  in  the  hands  of 
Governments  "  for  the  urgent  needs  of  the  nation,  or  for 
undertakings  of  national  ability." 


CHAPTER   III 

THE   DOUBLE   CURRENCY 

The  persistence  of  the  double  currency — The  history  of  paper  money — Thi' 
origins  of  the  premium  on  gold,  and  its  almost  continual  increase — Th( 
year  1890  and  the  depreciation  of  the  currency — The  causes  of  thii 
depreciation ;  abuses  in  the  issue  of  paper,  caused  by  a  bad  financial  anc 
administrative  policy. 

Remedies  suggested — Rosa's  law  fixing  the  value  of  paper  money  anc 
establishing  a  Cm'sse  de  Conversion — Opposition  to  this  law — Its  bene 
ficent  effect  upon  agriculture  and  stock-raising,  which  had  especial  nee( 
of  a  stable  medium  of  exchange — Reserve  fund  created  with  a  view  tij 
converting  paper  money ;  its  vicissitudes  in  the  past  and  its  presen' 
constitution — The  present  monetary  situation. 

IN  the  financial  history  of  the  nations  there  are  few. 
examples  o£  countries  in  which  the  phenomenon  of  twc 
standards  of  currency  has  manifested  itself  so  persistentlj 
and  for  so  long  a  period  as  iu  the  Argentine  Republic.  Thi« 
is  one  of  the  gloomiest  pages  of  its  past,  on  which  are  recordec 
all  the  errors  of  its  rulers,  all  the  abuses  of  speculation,  anc 
all  the  faults  of  administration  whose  cost  the  present 
generation  has  been  paying  since  the  opening  of  the  twentieth 
century. 

Since  the  27th  of  May  1820,  the  date  on  which  the  Junt£ 
of  Representatives  authorised  a  gradual  issue  of  papei 
money,  and  another  issue  of  redeemable  and  endorsabk 
notes,  the  latter  to  be  applied  to  the  payment  of  debts 
contracted  in  the  name  of  all  the  Provinces  during  the, 
previous  Administrations  ;  since  1820,  we  were  saying,  unti!! 
the  present  time,  there  have  been  few  years  indeed  during! 
which  the  Republic  has  not  been  under  the  empire  of  a! 
double  currency.* 

Our  paper  money,  says  an  Argentine  publicist,  originated  in 
an  issue  of  290,000  piastres  by  the  Banque  d'Escoonpte,  created 
in  virtue  of  a  law  of  the  Province  of  Buenos  Ayres,  dated  the 

*In  1820  the  issue  of  paper  money  was  40,000  piastres  per  month,  anc 
that  of  the  notes  was  the  same. 

330  I 


THE  DOUBLE  CURRENCY  331 

■2-2nd  of  June  1822.     Four  3-ears  later,  when  on  the  20th  of 

January  1826  the  Discount  Bank  was  transformed  into  the 

National    Bank,  the   issue    amounted  to   S2,694,>:56.     When 

the   National    Bank   was   in  turn  converted   into  the  Mint, 

eleven  years  later — that  is,  on  the  1st  of  January  1837 — the 

issue  had  already  auwunted  to  $15,283,540.     Seventeen  years 

later,    when    the    Mint    was    transformed     into    the    Pro- 

;    vincial    Bank    (1st   January    1854),  the   issue   amounted   to 

:  ;  $203,915,206.     Daring  the  twenty-seven  years  which  elapsed 

•  'between  the  creation  of  this  bank  and  the  passin?;  of  the 

'monetary  law  of  1881,  the  successive  issues  of  National  and 

;i  Provincial  Governments  had  increased  the  mass   of   incon- 

;  I  vertible  paper  to  the  sum  of  $882,071 ,156. 

It    was   then,   with    gold    at    2500   per   cent.,   that   the 
Government   began   to   recall   all   this  mass    of    paper,   re- 
placing it  by  another  issue,  of  which  the  one  piastre  notes 
i  exchanged  against  25,  or  a  piastre's  worth  of  the  issue  which 
I.  was  destined  to  disappear. 

This  operation,  which  at  a  blow  reduced  the  paper 
;  currency  to  a  twenty-fifth  part  of  its  original  amount,  also 
I  brought  gold  to  par.* 

I        In   1861   the   depreciation   of  paper   touched    it?   lowest 
i  point:    2483   piastre   notes   were   given    for    $100   in   gold. 
The  premium  was  thus  2383  per  cent. 

But  the  reader  must  not  take  this  to  be  the  only  surprise 
that  the  history  of  the  double  standard  has  in  store  ;  others, 
still  greater,  remain  to  be  told.  In  1862  the  depreciation 
was  even  lower,  the  premium  reaching  2456  per  cent.,  and 
2556  piastre  notes  being  given  for  $100  in  gold. 

The  premium  continued  to  rule   high   until    1867,  being 
2569  per  cent,  in  1863 ;  2784  per  cent,  in  1864,  2597  per  cent. 
I  in  1865,  and  2406  per  cent,  in  1866. 

I  We  stated  just  now  that  the  Republic,  during  a  long 
period  of  history,  never  escaped  from  the  inconveniences 
of  depreciated  paper  save  practically  on  two  occasions, 
which  were  unhappily  of  only  too  short  a  duration.  The 
first  occasion  was  when  Adolfo  Alsina  was  Governor  of 
■    the   Province   of    Buenos   Ayres.     The    "  Bureau    of    Bank 

•  See  Las  virisitud^s  de  nuestra  moneda  fiduciaria  en  los  ultimas  65  aflos 
I     (1826-1890),  by  F.  Latzina. 


332    THE  ARGENTINE  IN  THE  20th  CENTURY 

Exchanges  "  was  established,  its  mission  being  to  exchange 
one  piastre  in  gold  against  25  in  paper,  and  vice  versa.  This 
Bureau  was  in  operation  from  February  1867  to  May  1876, 
the  date  of  the  suspension  of  metallic  conversion. 

After  this  period  the  value  of  paper  money  declined  anew. 
In  May  1876  the  golden  coin  was  worth  28  piastre  notes;  ini, 
June,  30  ;  in  July,  33 ;  in  December,  29. 

In  1877  the  average  value  of  a  golden  piastre  was  29 
piastre  notes ;  that  is,  100  piastres  in  gold  represented  2900 
notes;  in  1878  the  ratio  was  3187;  in  1879,3220;  in  1880 
3055  ;  in  1881,  2706. 

It  was  at  this  time  that  the  second  exception  occurred, 
marking  another  check  to  the  constant  depreciation  of 
paper. 

In  November  1881,  under  the  Presidency  of  General  Roca,  { 
Sefior  Romero  being  Minister  of  Finance,  a  law  was  pro-; 
mulgated  establishing  a  bimetallic  standard  in  the  Argentine.  | 
The  monetary  unit  was  to  be  the  piastre  of  gold  or  of  silver  ;i 
the  first  weighing  24*9  grains  Troy,  and  the  second  383"8( 
grains,  both  being  alloys  containing  nine-tenths  of  the  purei 
metal.  This  law  also  established  the  metallic  conversion  of; 
depreciated  notes.  ; 

This  operation  was  a  beneficent  advance  in  the  economic, 
and  financial  system  of  the  country ;  for  by  establishing! 
metallic  conversion  it  gave  stability  to  the  legal  instrumentj 
of  monetary  transactions,  and  also  contributed  to  establish! 
an  enviable  state  of  affairs  during  the  years  1888  and  1884,1 
which  gave  rise  to  the  rosiest  hopes  for  the  future.  But  by! 
an  irony  of  fate  the  very  Government  which  had  suppressed  I 
the  double  standard  found  itself  forced  to  re-establish  it  in,' 
January  1885.  It  should  be  remarked  that  at  this  time* 
Sefior  Romero  was  no  longer  Minister  of  Finance. 

The  country  being  once  more  abandoned  to  the  miserable 
system  of  inconvertibility,  the  depreciation  of  paper  began 
its  downward  progress,  recalling  the  too  celebrated  case  of 
the  assignats,  a  case  one  would  have  thought  impossible  of , 
recurrence  in  time  of  peace  and  among  a  people  that  had 
suff'ered  no  catastrophe  for  many  years. 

In  June  1885  the  premium  rose  to  50  per  cent. ;  in  1886 
it  was  39  per  cent.;  in   1887,  35  per  cent.;  in  July  1888' 


: 


THE  DOUBLE  CURRENCY  333 

53  per  cent,  finally,  in  1889,  it  proceeded  by  leaps  and 
bounds ;  50  per  cent,  in  January,  it  was  53  per  cent,  a  month 
later;  in  March  it  was  55  per  cent.,  rising  to  120  per  cent. 
in  September  and  October,  and  130  per  cent,  in  November 
and  December,  despite  the  empirical  measures  of  alleviation 
adopted,  amid  violent  disputes,  by  the  Minister  of  Finance. 

Thus  the  Republic  entered  on  the  year  1890  ;  a  year  of 
grave  political  and  financial  disaster.  On  the  one  hand  was 
'  the  revolutionary  movement,  prepared  by  the  connivance  of 
part  of  the  army  and  the  navy ;  on  the  other  hand,  the 
crushing  depreciation  of  paper,  ending  in  an  absolute 
catastrophe  which  affected  both  public  and  private  fortunes. 

In  the  month  of  April  of  that  year  the  premium  increased 
to  215  per  cent. ;  that  is,  100  piastres  in  gold  were  equivalent 
to  315  in  paper.  In  July,  when  the  revolution  broke  out, 
it  stood  at  217  per  cent.  In  November  the  Government 
which  replaced  that  which  had  been  attacked  by  the  insur- 
gents prohibited  the  quotation  of  gold.  Nevertheless,  the 
premium  rose  to  225  per  cent,  and  remained  at  that  figure 
until  December. 

We  must  remember  that,  in  spite  of  the  downfall  of  paper, 

the  economic  vitality  of  the  Republic  had  suffered  no  serious 

:    blow ;  no  war  had  broken  out,  no  international  complication 

j    had  occurred  ;  there  was,  in  short,  no  organic  cause  to  which 

I    the  premium  could  be  attributed.     Certainly,  the  commercial 

balance  was   unfavourable ;   but  that  phenomenon   has  not 

the  significance  generally  attributed  to  it.     The  true  causes 

of  this  crushing  state  of  affairs  were  exclusively  of  a  financial 

and  administrative  nature.     It  was  the  inevitable  result  of 

the  manner  in  which  paper  money  had  been  issued  to  serve 

the  needs  of  the  Governmenv.,  and  to  feed  the  furnace  of 

speculation.     One   cannot   forget  that  at  the   end   of  1886 

'    the  total  issue  of  paper  amounted  to  $80,251,380  ;   that  in 

less   than  two   years  it  was  nearly  doubled,  amounting   to 

I    $147,503,911 ;  while  in  1890  the  paper  currency  reached  the 

I    figure  of  $196,882,500.     But  this  situation,  painful  as  it  was, 

■    could  not  be  suddenly  changed  for  the  better ;  other  causes 

of   a   like   nature   were   about   to   intensify   it.      The   new 

j     President,   who   came   into   power   after   the   revolutionary 

!     outbreak     found  himself   forced,  by  various   circumstances, 


334    THE  ARGENTINE  IN  THE  20th  CENTURY 

to  increase  the  existing  circulation  of  paper.     The  new  issues 
amounted  to  $150,000,000. 

As  was  only  to  be  expected,  such  an  issue  on  the  back 
of  the  existing  paper  currency,  which  exceeded  $196,000,000, 
could  only  produce  a  disastrous  fall  in  paper.  Its  depreciation 
touched  the  lowest  point  in  the  history  of  the  Argentine,  or 
of  any  other  country  during  the  second  half  of  the  nineteenth 
century  ;  the  blackboard  of  the  Stock  Exchange  showed  an 
exchange  value  of  464  per  cent,  or  a  premium  of  364  per 
cent.,  in  the  third  week  of  October  1891.  This  was  the 
record  of  monetary  depreciation. 

After  1892  the  monthly  quotation  of  gold,  in  relation  to 
paper,  oscillated  between  359  and  290  in  1893  ;  433  and  307 
in  1894;  377  and  311  in  1895;  352  and  266  in  1896;  317 
and  274  in  1897. 

We   see    from   these   figures    that   these   conditions   are 
abnormal,   extraordinary ;    and   yet,   owing    to    their    long 
duration,  they  are  almost  part   of   the   normal   life   of   the  ■ 
Republic.     It  is  therefore  a  matter  of  interest  to  study  the 
causes  of  such  phenomena,  in  order  to  decide  whether  they 
are  inherent  in  the  period  of  transformation  through  which 
the   country  is   passing,  in  which  case  it  would  be  idle  to  { 
attempt   any  reform   at   present,   or   whether   they  can   be  j 
controlled  or  checked  by  the  employment  of  means  counselled  { 
by  science  and  confirmed  by  experience.  j 

According  to  the  judgment  of  certain  persons  who  have] 
devoted  themselves  to  the  study  of  economic  questions,  the  \ 
causes  which,  in  the  Republic,  produce  the  double  standard, ' 
are  of  a  permanent  character,  proper  to  the  period  of  forma- 
tion through  which  the  country  is  passing.  It  is  even  said 
that  so  long  as  Argentina  has  not  a  capital  of  her  own  with 
which  to  float  herself  in  the  full  tide  of  affairs — such  a 
capital  as  is  the  result  of  years  or  centuries  of  prosperity — 
80  long  will  she  be  a  debtor  among  the  nations,  and  the 
system  of  the  double  currency  must  continue. 

We  ourselves  are  of  opinion  that  the  causes  which  have 
produced,  and  now  maintain  the  inconversion  of  the  fiduciary 
currency,  are  of  a  very  difi"erent  character  to  those  implied 
by  the  above  judgment ;  and  that  if  we  consider  the 
economic   state   of   the   country  at  the   moment   when  the 


THE  DOUBLE  CURRENCY  335 

double  standard  was  established,  we  shall  find  that  it  was 
in  no  way  responsible  for  the  phenomenon  of  depreciated 
currency.  The  true  cause  is  the  necessities  of  the  Govern- 
ment ;  determined  either  by  factors  beyond  the  ranj^e  of 
debate,  such,  for  example,  as  the  eventuality  of  a  foreign 
war,  or  by  less  justifiable  reasons,  such  as  deficits  in  the 
budo"et  and  reckless  issues  of  paper.  In  both  cases  the 
printing-presses  of  the  official  banks  have  been  set  to  work, 
in  order  to  tide  the  Government  over  a  difficult  passage, 
at  the  risk  of  vitiating  the  instrument  of  national  credit  by 
the  efflux  of  inconvertible  paper. 

Those  interested  should  read  the  history  of  the  first  issues, 
exposed  in  a  masterly  manner  by  Seiior  Augustin  de  Vedia, 
in  his  work  on  the  National  Bank ;  they  will  see  that  the 
excessive  issue  of  notes  cannot  be  explained  or  justified  by 
the  period  of  economic  formation  which  the  country  has 
passed  through.  We  must  search  for  other  causes  in  order 
to  explain  this  long  and  unfortunate  period  of  inconversion, 
which  lasted,  with  a  few  years'  respite,  from  1820  down 
to  1905. 

What,  for  example,  were  the  reasons  which  determined 
the  premium  on  gold  in  1885,  under  the  first  Presidency  of 
General  Eoca  ?  Was  it,  by  any  chance,  that  any  economic 
calamity  fell  upon  the  country  ?  Were  the  harvests  lost  ? 
or  was  there  a  foreign  war,  or  even  one  of  those  revolutionary 
risings  so  common  among  the  South  American  nations  ?  Did 
the  germs  of  some  epidemic  invade  the  country,  decimating 
the  population  by  disease  and  poverty?  Was  there  any 
violent  and  ruinous  fall  in  the  market  prices  of  Argentine 
products  ? 

Nothing  of  the  kind  befell.  The  Government  itself, 
in  the  message  in  which  it  solicited  the  ratification  of  the 
double  standard,  that  "the  national  production,  the  valuation 
and  the  degree  of  culture  of  the  soil,  had  consolidated  the 
national  credit."  The  crops  were  abundant ;  and  their  prices, 
in  foreign  markets,  were  more  than  fair.  The  Republic  was 
at  peace,  at  home  and  abroad  ;  thus  realising  one  of  the 
dreams  of  the  paternal  administration  which  directed  its 
destinies.  As  for  the  public  health,  it  suffered  no  perceptible 
eclipse  in  all  the  Argentine  Territory. 


336    THE  ARGENTINE  IN  THE  20th  CENTURY 

It  has  also  been  said  that  the  commercial  balances  were 
unfavourable  to  the  Argentine :  a  country  at  once  a  debtor 
and  a  centre  of  immigration.  And  it  has  been  asserted,  too, 
that  the  Republic  suffered  from  a  sudden  increase  of  growth, 
without  having  behind  it  any  reserves  of  accumulated  capital. 
The  affirmation  that  the  depreciation  of  the  currency,  and 
in  consequence  the  establishment  of  a  double  standard,  arose 
from  unfavourable  commercial  balances,  has  no  scientific 
basis  and  is  not  supported  by  precise  demonstration. 

"  None  of  the  countries  which  have  suffered  the  mis- 
fortune of  a  depreciated  currency  have  reached  that  condition 
purely  on  account  of  adverse  balances,"  as  a  Spanish 
economist,  Senor  Edouardo  Sans  y  Escartin,  has  said  with 
justice.  All  countries  have  suffered  from  this  evil,  on 
account  of  monetary  changes,  and  the  Argentine  is  only  the 
latest  example,  France  towards  the  end  of  the  eighteenth 
century,  England  from  1797  to  1821,  Austria  and  Russia): 
since  the  beginning  of  the  last  century,  the  United  States 
from  1862  to  1878,  Italy  since  1875,  Paraguay  since  1870, 
and  the  Hispano-American  Republics  for  the  last  twenty- 
five  years :  all  these  countries  have  suffered  from  monetary 
perturbations,  some  through  the  abuse  of  paper  money  or  the 
excess  of  the  fiduciary  circulation,  others  through  the  varia- ; 
tions  of  the  relation  of  gold  to  silver.  In  none  of  these  countries , 
did  the  crisis  take  the  form  of  the  consequence  of  unfavour- 
able commercial  balances. 

We  find,  in  fact,  that  it  is  not  the  case  that  economic 
causes,  resulting  either  from  the  formative  period  the  country 
has  traversed,  or  from  its  lack  of  accumulated  capital,  have 
contributed  and  are  still  contributing  in  the  Argentine 
Republic  to  prolong  the  system  of  inconversion ;  the  causes  \ 
are  exclusively  financial  and  administrative,  as  we  have 
already  maintained.* 

Having  glanced  at  the  circumstances  which  have  deter- , 
mined  the  state  of  monetary  inconversion  which  has  afflicted: 
the  country  ever  since  it  became  a  nation,   we  must  now: 

*  The  famous  Italian  economist,  Eteocle  Lorini,  maintained  in  a  book  which 
he  published  in  1902  (Za  Republica  Argentina  e  i  suoi  maggiori  problemi  di 
Economia  e  di  Finanza),  that  the  Republic  has  never  possessed  money,  but  only  , 
a  simple  legal  tender  or  instrument  of  exchange. 


ttattt' 
iroDitri 

Ike 
wrkei 


THE  DOUBLE  CURRENCY  337 

•xamine  the  remedies  which  the  public  powers  have  sufj^rjested 
in  the  hope  of  emergincj  from  tliis  detestable  state  of  atiairs. 

Every  presidency  has  declared  its  firm  intention  of 
redeeming  or  reducing  the  paper  currency  in  circulation  ;  but 
none  of  them  has  obtained  results  that  we  can  really  regard 
as  final. 

Of  all  the  attempts  to  terminate  the  condition  of  incon- 
\  ertibility,  to  give  stability  to  the  currency,  and  to  prepare, 
in  a  more  or  less  proximate  future,  for  the  establishment  of  a 
<ane  monetary  system,  the  most  earnest  and  scientific,  and 

hat  which  had  the  happiest  results,  was  that  which  emanated 
iiom  the  proposal  presented  to  Congress  in  August  1899  by 
the  ex-Minister  of  Finance,  Senor  Jose-Maria  Rosa,  which  has 
since  then  become  law  :  the  present  law  of  the  conversion  of 
the  fiduciary  currency. 

The  scheme  of  reform  of  this  eminent  statesman  was 
worked  out  on  the  following  basis : — 

1.  Immediately  to  fix  the  rate  at  which  the  future  con- 

version would  be  effected,  in  conformity  with  the 
actual  and  contemporary  value  of  the  currency. 
The  fixing  of  a  definite  rate  was  necessary  in  order  to 
consolidate  the  then  existing  state  of  affairs,  to 
suppress  the  premium,  and  to  give  transactions  a 
positive  basis,  without  indefinitely  retarding  the 
possibility  of  conversion  ;  and  also  to  prepare  for 
the  liquidation  of  old  issues,  and  to  deliver  the 
country  to  some  extent  from  the  gigantic  burden  of 
its  issues. 

2.  To  form  a  large  metallic  fund  to  guarantee  this  con- 

version and  to  make  it  possible  for  money  to  become 
stable  during  this  period. 

3.  To  maintain  a  fixed  standard  by  these  two  means: — 

(a)  The  creation,  in  the  Caisse  de  Conversion,  of  a 
bureau  operating  as  an  automatic  regulator,  in 
conformity  with  the  tightness  or  slackness  of 
money,  and  according  to  the  necessities  of  the 
market ;  thus  making  elastic  the  paper  cur- 
rency, the  circulation  of  which  might  increase 


338    THE  ARGENTINE  IN  THE  20th  CENTURY 

or  decrease,  on  account  of  the  quantity  of  gold 
given  out  in  exchange. 
(b)  The  intervention  of  the  Bank  of  the  Nation  in 
matters  of  international  exchanges. 

It  was  on  these  lines  that  the  Minister  drew  up,  and 
Congress  adopted,  a  law  which  enacted  that  the  nation 
should  convert,  during  a  fixed  period,  at  a  convenient  time, 
the  whole  fiduciary  circulation  into  Argentine  gold  coinage, 
at  the  rate  of  one  paper  piastre  for  44  centavos  of  a  gold 
piastre.  This  same  law  ordered  the  formation  of  a  Conver- 
sion Fund,  with  resources  which  it  enumerated ;  and  finally 
it  established  in  the  Caisse  de  Conversion  a  bureau  for  the 
exchange  of  paper  into  gold  and  vice  versa  to  all  who  might 
apply,  at  the  rate  of  one  paper  piastre  for  "44  of  a  gold 
piastre.  , 

Few  laws  have  been  so  beneficial  as  this  law  of  monetary  ' 
conversion    was   to   the   Argentine    Republic.     The   present 
prosperous  economic  conditions  of  the  country  are  the  work 
of  this  law ;  it  constitutes  the  glory  of  Roca's  Government, ; 
which  gave  it  birth  and  enjoyed  its  first  fruits. 

Yet  we  must  emphasise  the  fact  that  this  law,  so  bene- ; 
ficial  to  the  public,  was  at  the  outset  repudiated  not  only  by  i 
the  President,  who,  to  avoid  subscribing  to  it,  forced   his  ; 
Minister  to  send  in  his  resignation,  but  also  by  the  principal 
organs  of  the  press,  at  the  head  of  which  was  that  important 
journal  La  Nacion,  and  again  by  the  Professor  of  Finance  at 
the  University — M.  Terry — who  was  all  for  conversion  on  a 
sliding  scale ;   that  is,  for  the  worst  method  conceivable,  as 
by  maintaining  the  condition  of  instability  he  would  have 
adjourned  the  question  instead  of  solving  it.     But  thanks  to 
the  rare  energy  and   the  intelligent  propaganda  of   Sefior 
Rosa,  the  sole  author  of  the  law,  eflfectually  supported  by; 
Senator  Pellegrini  and  Senor  Tornquist,  this  important  step , 
was  accomplished,  despite   all  the   obstacles   which   barred 
the  way. 

In  a  very  short  time  this  law,  so  strongly  opposed  before 
its  birth,  produced  marvellously  beneficial  effects  upon  the 
economic  life  of  the  Republic.  It  gave  stability  to  the, 
currency;  that  is,  it  endowed  the  Argentine  with  one  of  the 


THE  DOUBLE  CURRENCY  339 

greatest  blessings  a  commercial  and  productive  nation  can 
enjoy. 

To  be  convinced  of  this  fact  it  is  enough  to  run  the  eye 
over  the  column  of  metallic  quotations  on  the  Exchange, 
published  in  the  "  Statistical  Annual  of  the  City  of  Buenos 
Ayres."* 

This  law  has  killed  speculation  on  exchange  values,  which 
before  it  was  passed  had  assumed  scandalous  proportions, 
and  went  far  to  developing  throughout  the  country  that 
passion  for  gambling  which  is  even  now  a  corroding  cancer 
at  the  heart  of  the  young  Republic,  t 

This  law  also  provided  for  the  formation  of  a  Conversion 
Fund,  which  was  a  powerful  factor — si  vis  pacem  para 
helium — in  the  pacific  solution  of  the  old  frontier  dispute 
with  Chili.  This  fund  amounts  to-day  to  £5,100,000  de- 
posited in  the  Bank  of  the  Nation,  and  would,  without  this 
far-sighted  law,  have  been  swallowed  up  in  the  whirlpool 
of  administrative  expenses. 

Lastly,  the  law  of  monetary  conversion  has  been  the 
salvation  of  agriculture  and  stock-raising,  the  two  chief 
sources  of  national  wealth,  by  preventing  the  too  rapid 
change  in  the  value  of  paper,  which  is  a  result  that  deserves 
to  be  considered  with  attention.  The  law  was  promulgated 
at  a  time  when  a  large  harvest  was  expected,  and  when, 
from  that  very  cause,  the  depreciation  of  paper  violently 
increased,  the  value  falling  from  278  in  August  1898  to  206 
in  December  of  the  same  year.  It  is  certain  that  at  this 
rate  the  depreciation  would  finally  have  touched  150,  to  the 
greater  profit  of  the  speculators. 

What  would  have  happened  had  the  monetary  situation 

*  Annuaire  statistique  de  la  Ville  de  Buenos  Ayres. — The  trausactione  in 
metallic  values  effected  on  the  Buenos  Ayres  Exchange  in  18'J'J  (before  the 
passing  of  the  law),  amounted  in  value  to  i;i0;»,817,116,  or  $1,234,579,370 
paper,  while  in  1908  there  were  none.  Any  one  wishing  to  exchange  gold  for 
paper  or  paper  for  gold  to-day,  goes  to  the  Caisse  de  Conversion,  where  the 
exchange  is  effected  without  any  charge. 

t  As  the  Annuaire  statislique  declares,  in  the  course  of  the  year  1908  no  less 
than  £8,100,000  changed  hands  over  the  sale  and  purchase  of  lottery  tickets 
and  betting  on  racehorses.  This  is  an  evil  that  may  grow  into  a  national 
calamity  if  nothing  is  done  to  arrest  it ;  and  we  see  with  pleasure  that  the 
Government  has  stated  its  intention  of  presenting  to  Congress  the  draft  of  a 
law  prohibiting  lotteries. 


340    THE  ARGENTINE  IN  THE  20th  CENTURY 

altered  so  rapidly  ?  The  Argentine  agriculturalist  or  stock- 
raiser,  having  paid  all  the  expenses  of  production  with  gold 
at  about  300  per  cent.,  would  have  been  forced,  by  reason  of 
the  rapid  depreciation  of  paper,  to  sell  his  products  at 
a  price  which  would  no  longer  compensate  him  for  his 
increased  expenditure.  This  would  inevitably  have  ruined 
the  producer — that  is,  the  principal  artisan  of  the  national 
fortune.  Far  from  opening  up  new  lands  with  his  plough- 
share, as  hitherto  had  always  been  the  case,  he  would  have 
abandoned  the  land  already  under  cultivation. 

We  need  not  describe  the  disaster  which  would  have 
overcome  the  country  under  such  conditions  as  these:  the 
loss  of  credit  both  at  home  and  abroad.  The  stream  of 
immigration  would  have  been  suspended ;  emigration,  on 
the  contrary,  would  have  increased,  taking  the  form  of  a 
veritable  exodus,  even  of  a  flight ;  and  each  impoverished 
and  disillusioned  emigrant,  as  he  left  the  Argentine,  would 
have  proclaimed  that  the  country  was  ruined.  As  a  result 
the  Argentine  would  have  been  for  years  partially  de- 
populated, or  at  least  deprived  of  the  new  recruits  which 
immigration  brings  in,  and  of  whom  it  has  such  need  in 
order  to  realise  the  value  of  more  virgin  territory. 

Worse  still :  once  the  harvest  was  sold,  at  prices  which 
could  no  longer  be  calculated  on  the  basis  of  the  cost,  gold, 
now  freed  from  all  restraint,  like  a  balloon  whose  mooring  is 
broken,  would  have  resumed  its  upward  journey.  The 
melancholy  spectacle  of  1890  and  1891  would  have  been 
repeated;  gold  would  have  risen  by  leaps  and  bounds,  in 
contradictory  and  incalculable  rushes,  finally  to  reach  the 
limits  that  mean  bankruptcy.* 

Such  are  the  disastrous  results  which  would  have  ensued 
had  not  the  law  of  monetary  conversion  come  just  in  time 
to  restrain  the  rapid  depreciation  of  paper,  and  to  give 
money  the  stability  it  must  possess  if  it  is  to  be  the  faithful 

*  We  remember  that  gold,  which  on  the  9th  of  August  1890  stood  at  35 
per  cent,  when  a  new  Government  came  into  power,  had  risen  to  425  per  cent. 
by  May  1891,  and  in  October  of  the  same  year  touched  464  per  cent. ;  the 
highest  premium  ever  known  in  the  long  history  of  the  double  standard  during 
the  last  half  of  the  nineteenth  century.  In  the  United  States  during  the  war  of 
secession,  the  premium  on  gold  rose  to  286  per  cent,  only  (on  July  the  4th 
1864). 


THE  DOUBLE  CURRENCY  341 

and  precise  instrument  of  commercial  transactions,  the 
common  measure  of  all  exchanges.  Such  were  the  beneficent 
results  which  followed  shortly  upon  the  operation  of  the 
law ;  and  we  can  only  regret  that  it  has  not  always  been 
understood  and  applied  with  sufficient  force  by  those  who 
were  responsible  for  putting  it  into  practice.  The  Govern- 
ments which  have  followed  since  then  have  not  always 
followed  the  ideal  of  economy  and  scrupulous  administration 
which  should  ensure  the  success  of  this  important  reform. 
None  the  less,  the  Conversion  Fund  amounts  to-day  to 
£5,100,000. 

According  to  the  figures  for  October  1909  the  monetary 
situation  of  the  country  may  be  summed  up  as  follows : — 

The  total  of  notes  in  circulation  amounts  to  $686,291,704 
paper,  equivalent  to  £60,393,670.  The  Conversion  Fund  of 
£5,100,000  in  gold,  added  to  £34,752,058  on  deposit  in  the 
Caisse  de  Conversion  and  to  the  £14,073,515  deposited  in 
the  various  banks  of  the  capital,  forms  a  total  of  £53,925,573. 
It  follows  from  these  eloquent  figures  that  the  fiduciary 
c^'rculation,  notes,  nickel,  and  copper,  is  guaranteed  in 
Argentina  by  an  actual  value  of  65-9  per  cent,  of  its  total ; 
the  notes  alone  are  guaranteed  by  89  per  cent,  of  gold. 

Unquiet  spirits  from  time  to  time,  including  the  enemies 
of  monetary  reform,  announce  their  opinion  in  the  press 
that  this  law  should  be  modified.  Quite  lately  the  well- 
known  journal  La  Nacion,  which  is  distinguished  by  the 
constancy  and  fervour  with  which  it  attacks  this  beneficent 
measure,  has  opened  its  columns  to  an  enquiry,  in  order  to 
obtain  the  opinion  of  the  public,  or  at  least  of  persons  com- 
petent in  such  matters.  Happily  common-sense  triumphed  ; 
the  law  remains  intact,  continuing  to  benefit  the  whole 
national  economy. 


CHAPTER   IV 

THE    CAISSE   DE   CONVERSION 

The  principles  on  which  the  establishment  of  this  institution  is  hased — The 
necessity  of  a  rapid  redemption  of  fiduciary  money — The  imperfect  success 
of  this  programme — New  issues  of  notes — New  attributes  of  the  Caisse 
dating  from  1899 — The  exchange  of  paper  for  gold  and  vice  versa — The 
development  of  this  system  of  exchange — The  authority  attaching  to  the 
Caisse. 

AMONG  the  official  institutions  which  are  closely  connected 
with  the  issue  and  redemption  of  paper  money,  the 
Caisse  de  Conversion  demands  a  special  place,  on  account 
of  the  important  part  which  it  plays  in  the  financial  life  of 
the  Republic.  This  establishment  was  created  in  1890,  at 
a  moment  particularly  critical  for  the  credit  of  the  country, 
when  the  terrible  crisis  occurred  which  ruined  several  banks 
and  resulted  in  a  depreciation  of  the  fiduciary  currency 
which  exceeded  all  expectation.  The  Government  which 
presided  over  the  destinies  of  the  country  understood  that 
it  was  necessary,  in  order  to  ameliorate  such  a  situation,  to 
put  some  means  into  practice  which  should  ensure  a  more 
gradual  movement  of  paper,  its  reduction  in  no  matter 
what  form,  and  its  future  convertibility  within  a  short  and 
definite  period,  as  the  message  declared  which  accompanied 
the  draft  of  the  law  submitted  to  Congress. 

In  obedience  to  these  excellent  principles  of  financial  and 
banking  policy,  it  proposed  the  creation  of  a  Junta  or  a 
special  Directorate,  "  independent  in  its  action,  and  uniting 
the  necessary  faculties  for  the  recovery,  administration,  and 
application  of  the  elements  that  must  be  confided  to  it  for 
the  efi'ectual  accomplishment  of  its  important  mission." 

An  "  important  mission  "  it  was  indeed  that  was  confided 
to  the  Junta  by  law ;  for  this  body  was  to  see  the  gradual 
conversion  and  redemption  of  paper  money,  supervise  the 
strict  execution  of  all  the  laws  relating  to  paper  money, 
and  oversee  all  issues  of  the  same. 
342 


THE  CAIS8E  DE  CONVERSION  343 

With  the  object  of  effecting,  sooner  or  later,  the  actual 
and  eft'ective  conversion  of  paper  money,  the  law  created  a 
"  Conversion  Fund,"  composed  of  the  metallic  reserves  of  the 
guaranteed  banks,  the  sums  for  which  these  same  banks 
would  be  debitors  on  account  of  the  value  of  stock  bought  as 
guarantees,  the  public  funds  issued  to  guarantee  the  bank 
issues,  and  all  the  sums  which,  in  virtue  of  other  legislative 
enactments,  might  be  destined  to  the  conversion  of  bank 
paper,  and  especially  those  proceeding  from  economies  made 
out  of  the  general  budgets. 

The  Executive  attached  a  special  significance  to  this 
fund,  proposing  to  use  it  to  great  advantage  in  the  future ; 
if  the  succeeding  Governments  had  the  wisdom  to  maintain 
the  elements  indispensable  to  the  regular  circulation  of  the 
national  currency. 

These  details  prove  that  the  fundamental  idea  at  the 
bottom  of  the  creation  of  the  Caisse  de  Conversion  was  that 
of  effecting,  by  its  help,  and  by  utilising  the  resources  with 
which  it  was  endowed,  a  rapid  redemption  of  paper  money. 
This  intention,  moreover,  was  solemnly  affirmed  at  home 
and  abroad  when  the  contract  was  signed  with  the  English 
bankers  for  the  issue  in  1891  of  the  loan  known  as  the 
"  Funding  Loan,"  amounting  to  £15,000,000 ;  in  virtue  of 
which  loan  the  Government  undertook  to  withdraw  from 
circulation,  during  each  of  the  years  1891,  1892,  and  1893, 
$15,000,000  in  notes,  or  $45,000,000  in  the  three  years. 

Unhappily  the  Government's  good  intentions  had  no 
practical  issue ;  the  Caisse  de  Conversion,  from  the  first 
moments  of  its  existence,  found  it  impossible  to  fulfil  its 
object. 

So  the  proposal  to  withdraw  $15,000,000  a  year  went  no 
further  than  a  beautiful  ideal  ;  it  never  took  definite  shape 
as  a  reality.  In  1891  $1,696,676  in  paper  were  burned  ; 
they  came  from  an  additional  customs  duty  on  certain 
imports.  In  1892  $1,463,424,  having  the  same  origin,  were 
disposed  of  in  the  same  way.  Besides  this  a  sum  of 
$3,511,600,  provided  by  the  payments  made  by  the  National 
Bank  and  the  Bank  of  the  Province  of  Buenos  Ayres  on 
account  of  $35,116,000  lent  them  by  the  Government  in 
order  to  help  thera  out  of  a  greatly  embarrassed  condition, 


344    THE  ARGENTINE  IN  THE  20th  CENTURY 

was  also  burned.  The  balance-sheet  of  receipts  and  ex- 
penditures drawn  up  every  year  by  the  Comptahilite  Generate 
records  only  $1,248,032  as  burned  in  1891,  and  $3,586,255 
in  1892,  or  $4,834,287  in  two  years ;  a  very  different  sum  to 
the  30  millions  which  the  Government  had  promised  to 
withdraw. 

Thus  the  Caisse  de  Conversion,  from  which  the  Minister 
of  Finance  had  hoped  so  much,  failed  at  its  birth,  and  as  an 
institution  gave  no  positive  results.  So  it  was  not  necessary, 
as  the  Minister  of  Finance,  Senor  Y.  F.  Lopez,  pleasantly 
remarked,  to  await  the  appreciation  of  future  Governments. 

But  this  is  not  all ;  instead  of  redeeming  the  promised 
quantities  of  fiduciary  money,  the  Government  which  was 
then  directing  the  destinies  of  the  country — we  must  believe 
that  it  was  compelled  by  circumstances,  which  are  so  often 
more  potent  than  the  human  will — the  Government  actually 
found  itself  forced  to  increase  the  total  of  paper  in  circulation 
by  emitting,  for  various  reasons,  further  issues  of  notes. 

Dominated  by  circumstances,  it  issued  in  1890  $35,116,000, 
in  order  to  legalise  the  excess  of  an  issue  delivered  to  the 
National  Bank  and  the  Bank  of  the  Province  of  Buenos 
Ayres.  In  the  course  of  the  same  year  it  created  an  issue 
of  60  millions  more,  in  order  to  furnish  the  National  Bank 
with  25  millions,  the  National  Mortgage  Bank  with 
25  millions,  and  the  City  of  Buenos  Ayres  with  10 
millions.  In  1891  it  issued  50  millions  in  order  to  found 
the  Bank  of  the  Argentine  Nation,  and  finally  5  millions 
more  for  the  Mortgage  Bank.  In  short,  urged  by  necessity, 
the  Government  created  $150,000,000  of  paper  in  two  years, 
which  on  the  top  of  a  previous  issue  of  $161,766,590  in  paper 
was  naturally  followed  by  disastrous  results. 

The  Government  which  took  charge  of  the  administration 
in  1892  also  manifested,  in  its  programme,  its  firm  intention 
of  increasing  the  value  of  paper  money  by  its  gradual 
redemption ;  an  operation  which  would,  of  course,  be  the 
duty  of  the  Caisse  de  Conversion.  To  this  end  it  included 
the  necessary  sums  in  the  budget,  and  $865,426  were  burned 
in  1893  and  $8,000,394  in  1894.  But  the  results  obtained 
by  this  measure  were  far  from  responding  to  the  hopes  which 
were  founded  upon  it ;  although  the  Government  religiously 


THE  CAIS8E  DE  CONVERSION  345 

and  with  much  solemnity,  burned  on  the  15th  of  each  month 
a  determined  sum  of  paper  money — usually  half  a  million — 
the  value  of  paper,  far  from  risinoj,  fell  further  and  further 
below  that  of  gold. 

The  Government  finally  saw  that  its  plan  was  useless; 
and  hastened  to  explain  itself  by  the  mouth  of  its  Minister 
of  Finance,  who  declared  that "  the  executive  power  recognises 
that  the  withdrawal  of  eight  millions  of  piastres  per  annum 
cannot  fundamentally  alter  the  price  of  our  paper ;  but  what 
it  does  affirm  is  that  this  quantity  will  be  sufficient,  provided 
the  production  of  the  country  increases,  provided  that  the 
exports  exceed  the  imports ;  that  is  to  say,  provided  that  the 
international  balances  are  in  favour  of  the  Republic." 

We  may  say  in  passing  that  these  two  desired  factors 
were  realised ;  but  not  the  expected  advantage,  for  the 
Government  again  made  the  mistake  of  issuing  15  millions 
of  internal  stock,  bearing  interest  (£1,320,000),  while  at 
the  same  time  it  extinguished  another  debt,  also  domestic, 
which  did  not  bear  interest. 

All  these  details  prove  in  a  conclusive  fashion  that  the 
original  and  organic  functions  of  the  Caisse  de  Conversion 
were  inverted  from  the  time  of  its  creation  ;  converting  that 
institution  into  a  factor  of  depression  in  all  that  concerned 
the  paper  currency,  instead  of  being  the  instrument  of 
increasing  its  value. 

After  this  date  the  Caisse  operated  as  a  secondary  and 
harmless  department  of  the  public  Administration;  leading 
an  almost  forgotten  existence,  until  the  year  1899,  when  the 
law  of  monetary  conversion  was  passed,  which  entrusted  it 
with  two  missions  of  gi'eat  importance,  which  were  destined 
to  exercise  a  beneficent  influence  upon  the  fiduciary  cir- 
culation, and  therefore  upon  the  economic  life  of  the 
Republic. 

One  of  these  two  missions  had  as  its  object  the  establish- 
ment of  an  office  for  the  exchange  of  paper  into  gold  and 
vice  versa,  at  the  rate  of  22727  piastres  in  paper  fori  piastre 
in  gold.  The  other  consisted  in  forming  a  Conversion  Fund, 
to  which  more  or  less  important  resources  were  assigned. 
This  fund  amounted  in  1902  to  £2,400,000  in  gold,  but  at 
a  moment  when  an  international  complication  was  believed 


346    THE  ARGENTINE  IN  THE  20th  CENTURY 

to  be  imminent  this  sum  was  placed  at  the  disposal  of  the 
Government  by  authorisation  of  Congress. 

The  Government  eventually  returned  £2,000,000  of  this 
sum,  and  since  then  the  fund  has  constantly  increased, 
amounting  in  1907  to  £5,100,000,  as  we  stated  when  speak- 
ing, in  the  passages  relating  to  the  issues  of  paper  money 
affected  by  the  Caisse  de  Conversion,  of  the  results  of  the 
application  of  this  new  law. 

The  law  to  which  we  are  referring  was  put  into  execution 
on  the  9th  of  December  1899.  On  that  day  the  first  trans- 
action under  the  new  law  was  effected ;  the  Caisse  received 
100  piastres  in  gold,  in  exchange  for  which  it  returned 
the  equivalent  in  notes,  in  the  proportion  of  44  centavos 
of  gold  to  a  piastre  note.  The  balance  drawn  on  the  31st  of 
December  showed  the  existence  of  £292-6  in  gold.  At  this 
same  date  the  fiduciary  currency  in  circulation  amounted  in 
all  to  $295,149,735. 

Let  us  now  look  into  the  operations  of  the  Caisse  de 
Conversion  after  this  date. 

During  the  year  1900  $18,398,449  (£3,679,690)  in  gold 
was  received ;  but  as  this  sum  was  eventually  withdrawn 
the  fiduciary  circulation  soon  reached  its  former  figure. 

In  1901  there  was  nothing  done  ;  that  is,  the  Caisse 
received  no  gold. 

In  1902  scarcely  anything  was  done;  £4209  was  received, 
and  £3636  was  paid  out,  leaving  a  balance  of  £573.  The 
operations  for  1902  began  in  October,  during  which  month 
the  Caisse  received  £68,  128.;  it  paid  out  £67,  12s.,  so  that 
£1  remained.  In  November  the  takings  increased  to  £1497, 
and  the  outgoings  were  £1466,  leaving  a  balance  of  £31. 
In  December  £2639  were  taken  and  £2102  issued,  leaving 
a  balance  of  £537. 

Only  in  1903  did  the  operations  of  the  Caisse  de  Conversion 
amount  to  anything.  The  two  principal  causes  of  this  state 
of  affairs  were,  firstly  the  settlement  of  the  frontier  dispute 
with  Chili,  a  question  which  had  caused  serious  alarm,  and 
had  resulted  in  enormous  official  expenses  during  the  few 
previous  years ;  and  secondly  the  size  of  the  commercial 
balances.  Bearing  this  in  mind,  it  is  not  surprising  that 
the  amount  of  gold  in  the  Caisse  de  Conversion,  and,  con- 


THE  CAISSE  DE  CONVERSION  347 

sequently  the  issues  of  paper  money,  should  have  commenced 
to  increase  and  have  continued  to  do  so  until  they  reached 
the  proportions  which  they  have  since  attained. 

In  1903  £9,208,284  in  gold  was  taken,  and  £1,576,625 
paid  out;  leaving  £7,648,229,  The  busiest  months  were 
April,  when  £2,519,048  was  taken,  and  March,  when  the 
takings  were  £1,738,395.  The  largest  outgoings  were  in 
March  and  July,  amounting  respectively  to  £239,133  and 
£222,104. 

In  succeeding  years  the  metallic  reserve  of  the  Caisse  de 
Conversion  has  continually  increased,  thanks  to  the  favour- 
able sense  of  the  economic  balances  of  the  nation's  trade, 
and  the  capital  which  has  entered  the  Republic,  to  be  employed 
in  the  establishment  of  new  industries,  or  the  creation  of 
railways,  tramways,  etc. 

At  the  time  of  writing  the  metallic  reserve  of  the  Caisse 
de  Conversion  has  lately  increased  to  £34,752,058,  which, 
added  to  the  £5,100,000  of  the  Conversion  Fund,  gives  a 
total  of  £39,852,058.  The  proportion  of  these  reserves  to 
the  paper  currency  in  circulation  is  to-day  65'9  per  cent. 

According  to  the  law  the  increase  of  the  metallic  balance 
in  the  Caisse  de  Conversion  has  inevitably  caused,  as  a  natural 
consequence,  the  parallel  increase  of  the  issues  of  notes, 
nickel,  and  silver,  of  which  the  amount  in  circulation  increased 
to  1688,177,998  on  31st  October  1909,  or  $393,028,267  more 
than  on  31st  December  1899,  the  year  in  which  the  law  of 
monetary  conversion  was  voted,  and  in  which  the  same  circu- 
lation amounted  to  $295,149,731. 

The  rapidity  with  which  the  emission  of  paper  has  increased 
has  caused  certain  journals,  and  especially  those  which  have 
been  prominent  in  attacking  the  law  of  monetary  conver- 
sion (whose  benej&cial  effects  they  were  yet  powerless  to 
deny)  to  raise  cries  of  alarm,  thinking  to  see  in  this  increase 
a  future  economic  peril,  or  the  seeds  of  a  dangerous  crisis, 
due  to  the  inflation  which,  in  their  judgment,  is  produced  by 
such  issues.  But  it  is  easy  to  prove  that  these  alarms  are 
not  justified  from  the  moment  when  such  issues  are  guar- 
anteed by  a  corresponding  deposit  of  metallic  currency  in 
the  Caisse  de  Conversion.  Moreover,  a  very  little  reflection 
will   show  that   one  cannot   help  admitting  that  this   gold. 


348    THE  ARGENTINE  IN  THE  20th  CENTURY 

being  the  product  of  the  ever-increasing  economic  balances  of 
the  country,  will  affect  the  monetary  situation  equally  if 
instead  of  being  in  reserve  in  the  Caisse  de  Conversion  it  is 
to  be  found  in  the  strong-rooms  of  private  banks. 

As  we  may  see  from  these  data,  the  Caisse  de  Conversion 
has  completely  changed  its  role.  It  has  abandoned  its 
original  function,  which  was  confided  to  it  by  the  law  ; 
namely,  the  redemption  of  the  fiduciary  currency  and  the 
re-establishment  of  the  monetary  equilibrium  when  destroyed 
by  excessive  issues  of  paper.  To-day  this  institution  is  merely 
a  purely  mechanical  department  of  the  Administration,  and  its 
functions  might  be  fulfilled,  at  any  rate  theoretically,  by 
other  administrative  departments  which  are  closely  connected 
with  it. 


CHAPTER  V 

THE    HALANCE-SHEET   OF   THE    ARGENTINE   ACCORDING   TO 
THE   INVENTORY   OF   SECURITIES. 

TnK  Inventory  or  Movable  Pkofkrty  or  Securities — The  capital  repre- 
sented by  movable  properties,  stocks,  bonds,  shares,  etc.,  is  the  only 
kind  of  capital  which  lends  itself  to  statistics— The  great  groups  of  mov- 
able properties  :  National  Funds,  Railway  Shares,  Insurance  Companies, 
Foreign  Banks,  Mortgage  Companies,  and  agricultural  and  industrial 
undertakings. 

The  nominal  amount  of  capital  represented  by  movable  values — Table  of  the 
annual  revenues  of  the  same,  and  the  sinking  fund- -Division  of  this  revenue 
among  the  dififerent  countries  having  capital  invested  in  the  Argentine. 

English  capital — The  importance  of  English  investments  in  all  branches  of 
Argentine  activity — The  benefits  of  a  reaction  in  favour  of  Argentine 
capital — French  capital;  its  small  value  compared  to  English  capital 
— German  capital  and  its  rapid  increase — Approximate  valuation  of  that 
portion  of  revenue  remaining  in  the  Argentine,  and  of  that  which  goes  to 
the  various  nations  having  capital  invested  in  the  country. 

The  Balance-Sheet — The  assets  are  principally  composed  of  exportation 
values;  the  liabilities,  the  value  of  imports — The  revenue  of  investments 
exported  to  foreign  countries,  and  the  total  of  the  sums  expended  by  the 
Argentine  abroad— Table  giving  a  summarised  Balance-sheet  and  the 
balance  in  favour  of  the  Argentine — International  exchanges  and  the  im- 
portation of  gold  confirm  this  favourable  situation — Argentine  capital  will 
presently  play  a  more  importantpart  in  the  country  as  compared  withforeign 
capital. 

The  Inventory  of  Movable  Values. 

THE  time  has  come  to  sum  up  our  conclusions,  and  we 
cannot  do  better  than  attempt  to  present  the  figures  of 
the  movements  of  the  capital  invested  in  the  Argentine,  and 
by  stating,  as  far  as  possible,  its  yield.  We  have  already 
had  occasion  to  declare  that  Europe  has  not  turned  her  atten- 
tion to  the  young  South  American  Republic  for  sentimental 
reasons,  nor  on  account  of  the  beauty  of  her  political  institu- 
tions nor  the  splendour  of  her  landscapes.  What  interests 
2  349 


350    THE  ARGENTINE  IN  THE  20th  CENTURY 

the  general  public  is  the  extraction  of  the  riches  of  the 
Argentine  soil ;  the  economic  and  industrial  expansion  of  the 
country,  and  its  fitness  as  a  field  for  investment  and  original 
enterprise. 

To  respond  to  this  mental  attitude  we  have  thought  it 
proper  to  undertake  a  dry  and  impartial  inquiry  into  the 
value  of  the  capital  invested  in  the  Argentine,  and  the  total 
of  its  yield.  Capital  represented  by  movable  values  is  the 
only  factor  which  has  in  some  sense  an  official  existence 
which  is  amenable  to  control ;  it  lends  itself  to  statistics  suffi- 
ciently precise  to  allow  of  our  estimating,  from  this  point  of 
view,  the  wealth  of  a  country  ;  and  it  is  consequently  in  this 
direction  that  we  may  search  for  a  standard  with  which  to 
compare  the  favourable  estimates  expressed  in  our  preceding 
chapters  on  the  subject  of  the  development  and  prosperity  of 
the  Argentine  Republic. 

This  inventory  will  lead  us  to  other  data,  which  are 
equally  instructive.  In  reviewing  the  movable  values 
and  in  estimating  their  yield  we  shall  at  the  same  time 
examine  into  the  general  movement  of  foreign  capital 
and  its  earnings,  so  that  we  shall  be  able  approximately 
to  state  the  amount  and  the  profits  of  the  capital  invested 
by  the  various  European  nations  which  have  dealt  with  this 
country. 

By  the  aid  of  these  statistics  we  shall  finally  see  the 
situation  of  the  Argentine,  which  the  results  of  its  foreign 
trade  have  shown  us  only  imperfectly,  in  its  true  light. 
Although  the  country  has  an  extremely  favourable  com- 
mercial balance,  which  in  1908  was  not  less  than  £24,000,000, 
this  sum  has  to  support  enormous  charges  for  the  payment  of 
interest  on  loans  placed  abroad:  the  dividends  of  railway 
companies,  of  banking  houses,  of  all  manner  of  land  companies, 
of  commercial  and  industrial  companies,  whose  shareholders 
are  abroad,  etc.  etc.  These  are  the  sums  we  are  trying  to 
determine,  in  order  to  draw  up  as  exactly  as  possible  the 
balance-sheet  of  the  Argentine. 

This  chapter  will  therefore  be  devoted  to  estimating  on 
the  one  hand  what  the  country  owes  to  foreign  capital,  and 
on  the  other  hand  what  profit  foreign  capital  draws  frum  its 


THE  BALANCE-SHEET  OF  THE  ARGENTINE   351 

account  of  Europe  aud  the  Argentine  that  we  wish  to 
present,  taking  as  our  basis  the  movable  values,  which 
are  the  only  serious  data  upon  which  we  can  base  our 
inquiry.* 

The  nominal  total  of  Argentine  movable  values  sub- 
scribed up  to  the  21st  December  1908  was  £474,396,935 
(in  gold),  of  which  sum  £219,513,399  represents  shares, 
£104,502,163  bonds,  and  £150,381,572  the  public  debt  of 
the  Nation,  the  Provinces,  the  municipalities,  the  capital 
of  State  railways,  and  the  capital  of  the  Bank  of  the 
Nation. 

If  we  compare  these  figures  with  the  inventory  of  the 
movable  values  existing  at  the  end  of  December  1904,  we 
shall  find  an  increase  of  £157,173,555.  But  if  we  take  account 
of  the  fact  that  in  the  first  amount  the  cedulas  of  the  Province 
of  Buenos  Ayres  figure  to  the  value  of  £15,400,000,  while  in 
the  second  they  amount  to  £10,400,000  on]y  (the  amount  of 
shares  admitted  to  conversion  by  the  Government),  we  see 
that  the  difference  is  considerably  greater. 

This  increase  does  not  arise  exclusively  from  the  new 
shares  issued  by  companies  created  during  the  last  two  years  ; 
a  large  proportion  is  due  to  existing  companies,  which  have 
at  last  decided  to  furnish  the  information  demanded  in  view 
of  this  new  inventory.  But  a  certain  number  of  companies 
still  remain  outside  the  inventory,  whose  stock  would  increase 
the  total  by  5  or  6  million  pounds. 

Here  is  the  list  of  the  stock  in  circulation  on  the  3lst 
December  1908: 


•  In  this  book  we  make  use  of  the  figures  which  Seiior  Alberto  Martinez 
cemmunicated  to  the  International  Statistical  Congress,  held  in  Paris  in  July 
1909. 


FTablk 


340    THE  ARGENTINE  IN  THE  20th  CENTURY 

altered  so  rapidly  ?  The  Argentine  agriculturalist  or  stock- 
raiser,  having  paid  all  the  expenses  of  production  with  gold 
at  about  300  per  cent.,  would  have  been  forced,  by  reason  of 
the  rapid  depreciation  of  paper,  to  sell  his  products  at 
a  price  which  would  no  longer  compensate  him  for  his 
increased  expenditure.  This  would  inevitably  have  ruined 
the  producer — that  is,  the  principal  artisan  of  the  national 
fortune.  Far  from  opening  up  new  lands  with  his  plough- 
share, as  hitherto  had  always  been  the  case,  he  would  have 
abandoned  the  land  already  under  cultivation. 

We  need  not  describe  the  disaster  which  would  have 
overcome  the  country  under  such  conditions  as  these:  the 
loss  of  credit  both  at  home  and  abroad.  The  stream  of 
immigration  would  have  been  suspended ;  emigration,  on 
the  contrary,  would  have  increased,  taking  the  form  of  a 
veritable  exodus,  even  of  a  flight ;  and  each  impoverished 
and  disillusioned  emigrant,  as  he  left  the  Argentine,  would 
have  proclaimed  that  the  country  was  ruined.  As  a  result 
the  Argentine  would  have  been  for  years  partially  de- 
populated, or  at  least  deprived  of  the  new  recruits  which 
immigration  brings  in,  and  of  whom  it  has  such  need  in 
order  to  realise  the  value  of  more  virgin  territory. 

Worse  still :  once  the  harvest  was  sold,  at  prices  which 
could  no  longer  be  calculated  on  the  basis  of  the  cost,  gold, 
now  freed  from  all  restraint,  like  a  balloon  whose  mooring  is 
broken,  would  have  resumed  its  upward  journey.  The 
melancholy  spectacle  of  1890  and  1891  would  have  been 
repeated;  gold  would  have  risen  by  leaps  and  bounds,  in 
contradictory  and  incalculable  rushes,  finally  to  reach  the 
limits  that  mean  bankruptcy.* 

Such  are  the  disastrous  results  which  would  have  ensued 
had  not  the  law  of  monetary  conversion  come  just  in  time 
to  restrain  the  rapid  depreciation  of  paper,  and  to  give 
money  the  stability  it  must  possess  if  it  is  to  be  the  faithful 

*  We  remember  that  gold,  which  on  the  9th  of  August  1890  stood  at  35 
per  cent,  when  a  new  Government  came  into  power,  had  risen  to  425  per  cent. 
by  May  1891,  and  in  October  of  the  same  year  touched  464  per  cent. ;  the 
highest  premium  ever  known  in  the  long  history  of  the  double  standard  during 
the  last  half  of  the  nineteenth  century.  In  the  United  States  during  the  war  of 
secesBion,  the  premium  on  gold  rose  to  286  per  cent,  only  (on  July  the  4th 
1864). 


THE  DOUBLE  CURRENCY  341 


.,   \   and    precise    instrument    of    commercial    transactions,    the 

»"''  common  measure  of  all  exchanges.     Such  were  the  beneficent 

^"''-    results  which  followed   shortly  upon   the   operation   of   the 

! '^ '    law ;   and  we  can  only  regret  that  it  has  not  always  been 

'^[^   understood  and  applied  with  suflEicient  force  by  those  who 

"■uine.   ^ere  responsible  for  putting  it  into  practice.     The  Govern- 

^'*    ments   which   have   followed    since   then   have   not  always 

''?^    followed  the  ideal  of  economy  and  scrupulous  administration 

Hi  which  should  ensure  the  success  of   this  important  reform. 

•'None   the   less,   the   Conversion    Fund   amounts    to-day   to 

i:5,100,000. 

According  to  the  figures  for  October  1909  the  monetary 
^^'»f  (situation  of  the  country  may  be  summed  up  as  follows: — 
>Mi.  I  The  total  of  notes  in  circulation  amounts  to  $686,291,704 
°^'' I  paper,  equivalent  to  £60,393,670.  The  Conversion  Fund  of 
*i  I  £5,100,000  in  gold,  added  to  £34,752,058  on  deposit  in  the 
^^^'  j  Caisse  de  Conversion  and  to  the  £14,073,515  deposited  in 
resiii  the  various  banks  of  the  capital,  forms  a  total  of  £53,925,573. 
'  It  follows  from  these  eloquent  figures  that  the  fiduciary 
^k  [  circulation,  notes,  nickel,  and  copper,  is  guaranteed  in 
ilii^  j  Argentina  by  an  actual  value  of  659  per  cent,  of  its  total ; 

'  the  notes  alone  are  guaranteed  by  89  per  cent,  of  gold. 
iic  Unquiet  spirits  from  time  to  time,  including  the  enemies 

^i  '  of  monetary  reform,  announce  their  opinion  in  the  press 
i^i  that  this  law  should  be  modified.  Quite  lately  the  well- 
Tfei  j  known  journal  La  Nacion,  which  is  distinguished  by  the 
W'  j  constancy  and  fervour  with  which  it  attacks  this  beneficent 
I,  in  j  measure,  has  opened  its  columns  to  an  enquiry,  in  order  to 
U  obtain  the  opinion  of  the  public,  or  at  least  of  persons  com- 
>  patent  in  such  matters.  Happily  common-sense  triumphed  ; 
DM'-  the  law  remains  intact,  continuing  to  benefit  the  whole 
in      national  economy. 


340    THE  ARGENTINE  IN  THE  20th  CENTURY 

altered  so  rapidly  ?  The  Argentine  agriculturalist  or  stock- 
raiser,  having  paid  all  the  expenses  of  production  with  gold 
at  about  300  per  cent.,  would  have  been  forced,  by  reason  of 
the  rapid  depreciation  of  paper,  to  sell  his  products  at 
a  price  which  would  no  longer  compensate  him  for  his 
increased  expenditure.  This  would  inevitably  have  ruined 
the  producer — that  is,  the  principal  artisan  of  the  national 
fortune.  Far  from  opening  up  new  lands  with  his  plough- 
share, as  hitherto  had  always  been  the  case,  he  would  have 
abandoned  the  land  already  under  cultivation. 

We  need  not  describe  the  disaster  which  would  have 
overcome  the  country  under  such  conditions  as  these :  the 
loss  of  credit  both  at  home  and  abroad.  The  stream  of 
immigration  would  have  been  suspended ;  emigration,  on 
the  contrary,  would  have  increased,  taking  the  form  of  a 
veritable  exodus,  even  of  a  flight ;  and  each  impoverished 
and  disillusioned  emigrant,  as  he  left  the  Argentine,  would 
have  proclaimed  that  the  country  was  ruined.  As  a  result 
the  Argentine  would  have  been  for  years  partially  de- 
populated, or  at  least  deprived  of  the  new  recruits  which 
immigration  brings  in,  and  of  whom  it  has  such  need  in 
order  to  realise  the  value  of  more  virgin  territory. 

Worse  still :  once  the  harvest  was  sold,  at  prices  which 
could  no  longer  be  calculated  on  the  basis  of  the  cost,  gold, 
now  freed  from  all  restraint,  like  a  balloon  whose  mooring  is 
broken,  would  have  resumed  its  upward  journey.  The 
melancholy  spectacle  of  1890  and  1891  would  have  been 
repeated;  gold  would  have  risen  by  leaps  and  bounds,  in 
contradictory  and  incalculable  rushes,  finally  to  reach  the 
limits  that  mean  bankruptcy.* 

Such  are  the  disastrous  results  which  would  have  ensued 
had  not  the  law  of  monetary  conversion  come  just  in  time 
to  restrain  the  rapid  depreciation  of  paper,  and  to  give 
money  the  stability  it  must  possess  if  it  is  to  be  the  faithful 

*  We  remember  that  gold,  -which  on  the  9th  of  August  1890  stood  at  35 
per  cent,  when  a  new  Government  came  into  power,  had  risen  to  425  per  cent. 
by  May  1891,  and  in  October  of  the  same  year  touched  464  per  cent. ;  the 
highest  premium  ever  known  in  the  long  history  of  the  double  standard  during 
the  last  half  of  the  nineteenth  century.  In  the  United  States  during  the  war  of 
BecesBion,  the  premium  on  gold  rose  to  286  per  cent,  only  (on  July  the  4th 
1864). 


THE  DOUBLE  CURRENCY  341 

and  precise  instrument  of  commercial  transactions,  the 
common  measure  of  all  exchanges.  iSuch  were  the  beneficent 
results  which  followed  shortly  upon  the  operation  of  the 
law ;  and  we  can  only  regret  that  it  has  not  always  been 
understood  and  applied  with  sufficient  force  by  those  who 
were  responsible  for  putting  it  into  practice.  The  Govern- 
ments which  have  followed  since  then  have  not  always 
followed  the  ideal  of  economy  and  scrupulous  administration 
which  should  ensure  the  success  of  this  important  reform. 
None  the  less,  the  Conversion  Fund  amounts  to-day  to 
£5,100,000. 

According  to  the  figures  for  October  1909  the  monetary 
situation  of  the  country  may  be  summed  up  as  follows : — 

The  total  of  notes  in  circulation  amounts  to  $686,291,704 
paper,  equivalent  to  £60,393,670,  The  Conversion  Fund  of 
£5,100,000  in  gold,  added  to  £34,752,058  on  deposit  in  the 
Gaisse  de  Conversion  and  to  the  £14,073,515  deposited  in 
the  various  banks  of  the  capital,  forms  a  total  of  £53,925,573. 
It  follows  from  these  eloquent  figures  that  the  fiduciary 
circulation,  notes,  nickel,  and  copper,  is  guaranteed  in 
Argentina  by  an  actual  value  of  65'9  per  cent,  of  its  total ; 
the  notes  alone  are  guaranteed  by  89  per  cent,  of  gold. 

Unquiet  spirits  from  time  to  time,  including  the  enemies 
of  monetary  reform,  announce  their  opinion  in  the  press 
that  this  law  should  be  modified.  Quite  lately  the  well- 
known  journal  La  Naeion,  which  is  distinguished  by  the 
constancy  and  fervour  with  which  it  attacks  this  beneficent 
measure,  has  opened  its  columns  to  an  enquiry,  in  order  to 
obtain  the  opinion  of  the  public,  or  at  least  of  persons  com- 
petent in  such  matters.  Happily  common-sense  triumphed  ; 
the  law  remains  intact,  continuing  to  benefit  the  whole 
national  economy. 


CHAPTER   IV 

THE    CAISSE  DE   CONVERSION 

The  principles  on  which  the  establishment  of  this  institution  is  hased — The 
necessity  of  a  rapid  redemption  of  fiduciary  money — The  imperfect  success 
of  this  programme — New  issues  of  notes — New  attributes  of  the  Caiste 
dating  from  1899 — The  exchange  of  paper  for  gold  and  vice  versa — The 
development  of  this  system  of  exchange — The  authority  attaching  to  the 
Caisse. 

AMONG  the  official  institutions  which  are  closely  connected 
with  the  issue  and  redemption  of  paper  money,  the 
Caisse  de  Conversion  demands  a  special  place,  on  account 
of  the  important  part  which  it  plays  in  the  financial  life  of 
the  Republic.  This  establishment  was  created  in  1890,  at 
a  moment  particularly  critical  for  the  credit  of  the  country, 
when  the  terrible  crisis  occurred  which  ruined  several  banks 
and  resulted  in  a  depreciation  of  the  fiduciary  currency 
which  exceeded  all  expectation.  The  Government  which 
presided  over  the  destinies  of  the  country  understood  that 
it  was  necessary,  in  order  to  ameliorate  such  a  situation,  to 
put  some  means  into  practice  which  should  ensure  a  more 
gradual  movement  of  paper,  its  reduction  in  no  matter 
what  form,  and  its  future  convertibility  within  a  short  and 
definite  period,  as  the  message  declared  which  accompanied 
the  draft  of  the  law  submitted  to  Congress. 

In  obedience  to  these  excellent  principles  of  financial  and 
banking  policy,  it  proposed  the  creation  of  a  Junta  or  a 
special  Directorate,  "  independent  in  its  action,  and  uniting 
the  necessary  faculties  for  the  recovery,  administration,  and 
application  of  the  elements  that  must  be  confided  to  it  for 
the  efi"ectual  accomplishment  of  its  important  mission." 

An  "  important  mission  "  it  was  indeed  that  was  confided 
to  the  Junta  by  law ;  for  this  body  was  to  see  the  gradual 
conversion  and  redemption  of  paper  money,  supervise  the 
strict  execution  of  all  the  laws  relating  to  paper  money, 
and  oversee  all  issues  of  the  same. 
342 


THE  CAIS8E  DE  CONVERSION  343 

With  the  object  of  effecting,  sooner  or  later,  the  actual 

,  and  efVective  conversion  of  paper  money,  the  law  created  a 

"  Conversion  Fund,"  composed  of  the  metallic  reserves  of  the 

guaranteed   banks,  the   sums   for  which  these  same   banks 

would  be  debitors  on  account  of  the  value  of  stock  bought  as 

guarantees,  the  public  funds  issued  to  guarantee  the  bank 

issues,  and  all  the  sums  which,  in  virtue  of  other  legislative 

I  enactments,   might  be  destined  to  the  conversion    of   bank 

I  paper,  and  especially  those  proceeding  from  economies  made 

'  out  of  the  general  budgets. 

The   Executive   attached    a   special   significance   to   this 

fund,  proposing  to  use  it  to  great  advantage  in  the  future ; 

if  the  succeeding  Governments  had  the  wisdom  to  maintain 

'  the  elements  indispensable  to  the  regular  circulation  of  the 

national  currency. 

These   details   prove   that   the  fundamental  idea  at  the 

bottom  of  the  creation  of  the  Caisse  cle  Conversion  was  that 

I   of  effecting,  by  its  help,  and  by  utilising  the  resources  with 

I    which  it  was  endowed,  a  rapid  redemption  of  paper  money. 

f   This   intention,  moreover,  was   solemnly  affirmed   at   home 

and  abroad  when  the  contract  was  signed  with  the  English 

t    bankers   for  the  issue  in   1891  of  the  loan   known  as   the 

'    "  Funding  Loan,"  amounting  to  £15,000,000 ;   in  virtue   of 

which  loan   the  Government  undertook  to  withdraw  from 

circulation,  during  each  of  the  years  1891,  1892,  and  1893, 

§15,000,000  in  notes,  or  $45,000,000  in  the  three  years. 

.  Unhappily    the    Government's   good   intentions   had   no 

I    practical   issue;   the    Caisse  de   Conversion,  from   the   first 

moments   of   its  existence,  found  it  impossible  to  fulfil  its 

object. 

So  the  proposal  to  withdraw  $15,000,000  a  year  went  no 
further  than  a  beautiful  ideal  ;  it  never  took  definite  shape 
as  a  reality.  In  1891  $1,696,676  in  paper  were  burned  ; 
they  came  from  an  additional  customs  duty  on  certain 
imports.  In  1892  $1,463,424,  having  the  same  origin,  were 
disposed  of  in  the  same  way.  Besides  this  a  sum  of 
$3,511,600,  provided  by  the  payments  made  by  the  National 
Bank  and  the  Bank  of  the  Province  of  Buenos  Ayres  on 
account  of  $35,116,000  lent  them  by  the  Government  in 
order  to  help  thera  out  of  a  greatly  embarrassed  condition, 


344    THE  ARGENTINE  IN  THE  20th  CENTURY 

was  also  burned.  The  balance-sheet  of  receipts  and  ex- 
penditures drawn  up  every  year  by  the  Comptabilite  Generale 
records  only  $1,248,032  as  burned  in  1891,  and  $3,586,255 
in  1892,  or  $4,834,287  in  two  years;  a  very  different  sum  to 
the  30  millions  which  the  Government  had  promised  to 
withdraw. 

Thus  the  Caisse  de  Conversion,  from  which  the  Minister 
of  Finance  had  hoped  so  much,  failed  at  its  birth,  and  as  an 
institution  gave  no  positive  results.  So  it  was  not  necessary, 
as  the  Minister  of  Finance,  Sefior  V.  F.  Lopez,  pleasantly 
remarked,  to  await  the  appreciation  of  future  Governments, 

But  this  is  not  all ;  instead  of  redeeming  the  promised 
quantities  of  fiduciary  money,  the  Government  which  was 
then  directing  the  destinies  of  the  country — we  must  believe 
that  it  was  compelled  by  circumstances,  which  are  so  often 
more  potent  than  the  human  will — the  Government  actually 
found  itself  forced  to  increase  the  total  of  paper  in  circulation 
by  emitting,  for  various  reasons,  further  issues  of  notes. 

Dominated  by  circumstances,  it  issued  in  1890  $35,116,000, 
in  order  to  legalise  the  excess  of  an  issue  delivered  to  the 
National  Bank  and  the  Bank  of  the  Province  of  Buenos 
Ayres.  In  the  course  of  the  same  year  it  created  an  issue 
of  60  millions  more,  in  order  to  furnish  the  National  Bank 
with  25  millions,  the  National  Mortgage  Bank  with 
25  millions,  and  the  City  of  Buenos  Ayres  with  10 
millions.  In  1891  it  issued  50  millions  in  order  to  found 
the  Bank  of  the  Argentine  Nation,  and  finally  5  millions 
more  for  the  Mortgage  Bank.  In  short,  urged  by  necessity, 
the  Government  created  $150,000,000  of  paper  in  two  years, 
which  on  the  top  of  a  previous  issue  of  $161,766,590  in  paper 
was  naturally  followed  by  disastrous  results. 

The  Government  which  took  charge  of  the  administration 
in  1892  also  manifested,  in  its  programme,  its  firm  intention 
of  increasing  the  value  of  paper  money  by  its  gradual 
redemption ;  an  operation  which  would,  of  course,  be  the 
duty  of  the  Caisse  de  Conversion.  To  this  end  it  included 
the  necessary  sums  in  the  budget,  and  $865,426  were  burned 
in  1893  and  $8,000,394  in  1894.  But  the  results  obtained 
by  this  measure  were  far  from  responding  to  the  hopes  which 
were  founded  upon  it ;  although  the  Government  religiously 


THE  CAISSE  DE  CONVERSION  345 

and  with  much  solemnity,  burned  on  the  15th  of  each  month 
a  determined  sum  of  paper  money — usually  half  a  million — 
the  value  of  paper,  far  from  rising,  fell  further  and  further 
till  below  that  of  gold. 

The  Government  tinally  saw  that  its  plan  was  useless; 
and  hastened  to  explain  itself  by  the  mouth  of  its  Minister 
of  Finance,  who  declared  that "  the  executive  power  recognises 
that  the  withdrawal  of  eight  millions  of  piastres  per  annum 
cannot  fundamentally  alter  the  price  of  our  paper ;  but  what 
it  does  affirm  is  that  this  quantity  will  be  sufficient,  provided 
the  production  of  the  country  increases,  provided  that  the 
exports  exceed  the  imports ;  that  is  to  say,  provided  that  the 
international  balances  are  in  favour  of  the  Republic." 

We  may  say  in  passing  that  these  two  desired  factors 
were  realised ;  but  not  the  expected  advantage,  for  the 
Government  again  made  the  mistake  of  issuing  15  millions 
of  internal  stock,  bearing  interest  (£1,320,000),  while  at 
the  same  time  it  extinguished  another  debt,  also  domestic, 
which  did  not  bear  interest. 

All  these  details  prove  in  a  conclusive  fashion  that  the 
original  and  organic  functions  of  the  Caisse  de  Conversion 
were  inverted  from  the  time  of  its  creation  ;  converting  that 
institution  into  a  factor  of  depression  in  all  that  concerned 
the  paper  currency,  instead  of  being  the  instrument  of 
increasing  its  value. 

After  this  date  the  Caisse  operated  as  a  secondary  and 
harmless  department  of  the  public  Administration ;  leading 
an  almost  forgotten  existence,  until  the  year  1899,  when  the 
law  of  monetary  conversion  was  passed,  which  entrusted  it 
with  two  missions  of  great  importance,  which  were  destined 
to  exercise  a  beneficent  influence  upon  the  fiduciary  cir- 
culation, and  therefore  upon  the  economic  life  of  the 
Republic. 

One  of  these  two  missions  had  as  its  object  the  establish- 
ment of  an  office  for  the  exchange  of  paper  into  gold  and 
vice  versa,  at  the  rate  of  22727  piastres  in  paper  for  1  piastre 
in  gold.  The  other  consisted  in  forming  a  Conversion  Fund, 
to  which  more  or  less  important  resources  were  assigned. 
This  fund  amounted  in  1902  to  £2,400,000  in  gold,  but  at 
a  moment  when  an  international  complication  wa«  believed 


346    THE  ARGENTINE  IN  THE  20th  CENTURY 

to  be  imminent  this  sum  was  placed  at  the  disposal  of  the 
Government  by  authorisation  of  Congress. 

The  Government  eventually  returned  £2,000,000  of  this 
sum,  and  since  then  the  fund  has  constantly  increased, 
amounting  in  1907  to  £5,100,000,  as  we  stated  when  speak- 
ing, in  the  passages  relating  to  the  issues  of  paper  money 
affected  by  the  Caisse  de  Conversion,  of  the  results  of  the 
application  of  this  new  law. 

The  law  to  which  we  are  referring  was  put  into  execution 
on  the  9th  of  December  1899.  On  that  day  the  first  trans- 
action under  the  new  law  was  effected ;  the  Caisse  received 
100  piastres  in  gold,  in  exchange  for  which  it  returned 
the  equivalent  in  notes,  in  the  proportion  of  44  centavos 
of  gold  to  a  piastre  note.  The  balance  drawn  on  the  31st  of 
December  showed  the  existence  of  £292'6  in  gold.  At  this 
same  date  the  fiduciary  currency  in  circulation  amounted  in 
all  to   $295,149,735. 

Let  us  now  look  into  the  operations  of  the  Caisse  de 
Conversion  after  this  date. 

During  the  year  1900  $18,398,449  (£3,679,690)  in  gold 
was  received ;  but  as  this  sum  was  eventually  withdrawn 
the  fiduciary  circulation  soon  reached  its  former  figure. 

In  1901  there  was  nothing  done  ;  that  is,  the  Caisse 
received  no  gold. 

In  1902  scarcely  anything  was  done;  £4209  was  received, 
and  £3636  was  paid  out,  leaving  a  balance  of  £573.  The 
operations  for  1902  began  in  October,  during  which  month 
the  Caisse  received  £68,  12s.;  it  paid  out  £67,  12s.,  so  that 
£1  remained.  In  November  the  takings  increased  to  £1497, 
and  the  outgoings  were  £1466,  leaving  a  balance  of  £31. 
In  December  £2639  were  taken  and  £2102  issued,  leaving 
a  balance  of  £537. 

Only  in  1903  did  the  operations  of  the  Caisse  de  Conversion 
amount  to  anything.  The  two  principal  causes  of  this  state 
of  affairs  were,  firstly  the  settlement  of  the  frontier  dispute 
with  Chili,  a  question  which  had  caused  serious  alarm,  and 
had  resulted  in  enormous  official  expenses  during  the  few 
previous  years ;  and  secondly  the  size  of  the  commercial 
balances.  Bearing  this  in  mind,  it  is  not  surprising  that 
the  amount  of  gold  in  the  Caisse  de  Conversion,  and,  con- 


THE  GAISSE  DE  CONVERSION  :?47 

gequently  the  issues  of  paper  money,  should  have  commenced 
to  increase  and  have  continued  to  do  so  until  they  reached 
the  proportions  wliich  they  have  since  attained. 

In  1903  £9,208,284  in  gold  was  taken,  and  £1,576,625 
paid  out;  leaving  £7,648,229.  The  busiest  months  were 
April,  when  £2,519,048  was  taken,  and  March,  when  the 
takings  were  £1,738,395.  The  largest  outgoings  were  in 
March  and  July,  amounting  respectively  to  £239,133  and 
£222,104. 

In  succeeding  years  the  metallic  reserve  of  the  Caisse  de 
Conversion  has  continually  increased,  thanks  to  the  favour- 
able sense  of  the  economic  balances  of  the  nation's  trade, 
and  the  capital  which  has  entered  the  Republic,  to  be  employed 
in  the  establishment  of  new  industries,  or  the  creation  of 
railways,  tramways,  etc. 

At  the  time  of  writing  the  metallic  reserve  of  the  Caisse 
de  Conversion  has  lately  increased  to  £34,752,058,  which, 
added  to  the  £5,100,000  of  the  Conversion  Fund,  gives  a 
total  of  £89,852,058.  The  proportion  of  these  reserves  to 
the  paper  currency  in  circulation  is  to-day  659  per  cent. 

According  to  the  law  the  increase  of  the  metallic  balance 
in  the  Caisse  de  Conversion  has  inevitably  caused,  as  a  natural 
consequence,  the  parallel  increase  of  the  issues  of  notes, 
nickel,  and  silver,  of  which  the  amount  in  circulation  increased 
to  $688,177,998  on  31st  October  1909,  or  $393,028,267  more 
than  on  31st  December  1899,  the  year  in  which  the  law  of 
monetary  conversion  was  voted,  and  in  which  the  same  circu- 
lation amounted  to  $295,149,731. 

The  rapidity  with  which  the  emission  of  paper  has  increased 
has  caused  certain  journals,  and  especially  those  which  have 
been  prominent  in  attacking  the  law  of  monetary  conver- 
sion (whose  beneficial  effects  they  were  yet  powerless  to 
deny)  to  raise  cries  of  alarm,  thinking  to  see  in  this  increase 
a  future  economic  peril,  or  the  seeds  of  a  dangerous  crisis, 
due  to  the  inflation  which,  in  their  judgment,  is  produced  by 
such  issues.  But  it  is  easy  to  prove  that  these  alarms  are 
not  justified  from  the  moment  when  such  issues  are  guar- 
anteed by  a  corresponding  deposit  of  metallic  currency  in 
the  Caisse  de  Conversion.  Moreover,  a  very  little  reflection 
will   show  that   one  cannot   help  admitting  that  this   gold. 


348    THE  ARGENTINE  IN  THE  20th  CENTURY 

being  the  product  of  the  ever-increasing  economic  balances  o 
the  country,  will  affect  the  monetary  situation  equally  i 
instead  of  being  in  reserve  in  the  Caisse  de  Conversion  it  i 
to  be  found  in  the  strong-rooms  of  private  banks. 

As  we  may  see  from  these  data,  the  Caisse  de  Conversioi 
has  completely  changed  its  role.  It  has  abandoned  it 
original  function,  which  was  confided  to  it  by  the  law 
namely,  the  redemption  of  the  fiduciary  currency  and  th 
re-establishment  of  the  monetary  equilibrium  when  destroyer 
by  excessive  issues  of  paper.  To-day  this  institution  is  merel; 
a  purely  mechanical  department  of  the  Administration,  and  it 
functions  might  be  fulfilled,  at  any  rate  theoretically,  h 
other  administrative  departments  which  are  closely  connecte 
with  it. 


CHAPTER  V 

THE    BALANCE-SHEET   OF   THE    ARGENTINE    ACCORDING   TO 
THE    INVENTORY    OF   SECURITIES. 

The  Inventory  or  Movable  Profkuty  or  Secprities — The  capital  repro- 
sented  by  movable  properties,  etockB,  bonds,  shares,  etc.,  is  the  only 
kind  of  capital  which  lends  itself  to  statistics — The  great  groups  of  mov- 
able properties  :  National  Funds.  Railway  Shares,  Insurance  Companies, 
Foreign  Banks.  Mortgage  Companies,  and  agricultural  and  industrial 
undertakings. 

The  nominal  amount  of  capital  represented  by  movable  values — Table  of  the 
annual  revenues  of  the  same,  and  the  sinking  fund- -Division  of  this  revenue 
among  the  diflfereut  countries  having  capital  invested  in  the  Argentine. 

English  capital — The  importance  of  English  investments  in  all  branches  of 
Argentine  activity — The  benefits  of  a  reaction  in  favour  of  Argentine 
capital — French  capital ;  its  small  value  compared  to  English  capital 
— German  capital  and  its  rapid  increase — Approximate  valuation  of  that 
portion  of  revenue  remaining  in  the  Argentine,  and  of  that  which  goes  to 
the  various  nations  having  capital  invested  in  the  country. 

The  Balance-Sheet — The  assets  are  principally  composed  of  exportation 
values;  the  liabilities,  the  value  of  imports — The  revenue  of  investments 
exported  to  foreign  countries,  and  the  total  of  the  sums  expended  by  the 
Argentine  abroad — Table  giving  a  summarised  Balance-sheet  and  the 
balance  in  favour  of  the  Argentine — International  exchanges  and  the  im- 
portation of  gold  confirm  this  favourable  situation — Argentine  capital  will 
presently  play  a  more  import  ant  part  in  the  country  as  compared  with  foreign 
capital. 

The  Inventory  of  Movable  Values. 

THE  time  has  come  to  sum  up  our  conclusions,  and  we 
cannot  do  better  than  attempt  to  present  the  figures  of 
the  movements  of  the  capital  invested  in  the  Argentine,  and 
by  stating,  as  far  as  possible,  its  yield.  We  have  already 
had  occasion  to  declare  that  Europe  han  not  turned  her  atten- 
tion to  the  young  South  American  Republic  lor  sentimental 
reasons,  nor  on  account  of  the  beauty  of  her  political  institu- 
tions nor  the  splendour  of  her  landscapes.  What  interests 
2  349 


350    THE  ARGENTINE  IN  THE  20th  CENTURY 

the  general  public  is  the  extraction  of  the  riches  of  the 
Argentine  soil ;  the  economic  and  industrial  expansion  of  the 
country,  and  its  fitness  as  a  field  for  investment  and  original 
enterprise. 

To  respond  to  this  mental  attitude  we  have  thought  it 
proper  to  undertake  a  dry  and  impartial  inquiry  into  the 
value  of  the  capital  invested  in  the  Argentine,  and  the  total 
of  its  yield.  Capital  represented  by  movable  values  is  the 
only  factor  which  has  in  some  sense  an  official  existence 
which  is  amenable  to  control ;  it  lends  itself  to  statistics  suffi- 
ciently precise  to  allow  of  our  estimating,  from  this  point  of 
view,  the  wealth  of  a  country ;  and  it  is  consequently  in  this 
direction  that  we  may  search  for  a  standard  with  which  to 
compare  the  favourable  estimates  expressed  in  our  precediog 
chapters  on  the  subject  of  the  development  and  prosperity  of 
the  Argentine  Republic. 

This  inventory  will  lead  us  to  other  data,  which  are 
equally  instructive.  In  reviewing  the  movable  values 
and  in  estimating  their  yield  we  shall  at  the  same  time 
examine  into  the  general  movement  of  foreign  capital 
and  its  earnings,  so  that  we  shall  be  able  approximately 
to  state  the  amount  and  the  profits  of  the  capital  invested 
by  the  various  European  nations  which  have  dealt  with  this 
country. 

By  the  aid  of  these  statistics  we  shall  finally  see  the 
situation  of  the  Argentine,  which  the  results  of  its  foreign 
trade  have  shown  us  only  imperfectly,  in  its  true  light. 
Although  the  country  has  an  extremely  favourable  com- 
mercial balance,  which  in  1908  was  not  less  than  £24,000,000, 
this  sum  has  to  support  enormous  charges  for  the  payment  of 
interest  on  loans  placed  abroad:  the  dividends  of  railway 
companies,  of  banking  houses,  of  all  manner  of  land  companies, 
of  commercial  and  industrial  companies,  whose  shareholders 
are  abroad,  etc.  etc.  These  are  the  sums  we  are  trying  to 
determine,  in  order  to  draw  up  as  exactly  as  possible  the 
balance-sheet  of  the  Argentine. 

This  chapter  will  therefore  be  devoted  to  estimating  on 
the  one  hand  what  the  country  owes  to  foreign  capital,  and 
on  the  other  hand  what  profit  foruiga  capital  draws  fruiu  its 
inveetment  in  the  Argentine.     It  is  to  some  extent  the  current 


THE  BALANCE-SHEET  OF  THE  ARGENTINE  351 

account   of   Europe   and    the    Argentine   that    we    wish    to 

present,  taking  as  our  basis  the  movable  vahiea,  which 
i  are  the  only  serious  data  upon  which  we  can  base  our 
j  inquiry.* 

The  nominal  total  of  Argentine  movable  values  sub- 
[  scribed  up  to  the  21st  December  1908  was  £474,396,935 
i  (in  gold),  of  which  sum  £219,513,399  represents  sharcp, 
I  £104,502,163  bonds,  and  £150,381,572  the  public  debt  of 
1  the  Nation,  the  Provinces,  the  municipalities,  the  capital 
i  of  State  railways,  and  the  capital  of  the  Bank  of  the 
I   Nation. 

I  If  we  compare  these  iSgures  with  the  inventory  of  the 
I  movable  values  existing  at  the  end  of  December  1904,  we 
•  shall  find  an  increase  of  £157,173,555.  But  if  we  take  account 
i   of  the  fact  that  in  the  first  amount  the  cedulas  of  the  Province 

of  Buenos  Ayres  figure  to  the  value  of  £15,400,000,  while  in 
.  the  second  they  amount  to  £10,400,000  only  (the  amount  of 
I  shares  admitted  to  conversion  b}'  the  Government),  we  see 
i    that  the  difference  is  considerably  greater. 

This  increase  does  not  arise  exclusively  from  the  new 
I  shares  issued  by  companies  created  during  the  last  two  years  ; 
j  a  large  proportion  is  due  to  existing  companies,  which  have 
;    at  last  decided  to  furnish  the  information  demanded  in  view 

of  this  new  inventory.  But  a  certain  number  of  companies 
,  still  remain  outside  the  inventory,  whose  stock  would  increase 
j    the  total  by  5  or  6  million  pounds. 

J  Here  is  the  list  of  the  stock  in  circulation  on  the  3lst 

i    December  1 908  : 

1  •  In  this  book  we  make  use  of  the  fiKurcB  which  Seftor  Alberto  Martinez 

I  ccmmunicated  to  the  International  Statistical  Congresa,  held  in  Paris  in  Julj 
i     1909. 


[Table 


352    THE  ARGENTINE  IN  THE  20th  CENTURY 


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THE  BALANCE-SHEET  OF  THE  AP.OENTTNE        353 


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354    THE  ARGENTINE  IN  THE  20th  CENTURY 

The  largest  group  of  investments  is  constituted  by  the 
capital  represented  by  the  private  railway  companies,  which 
amounts  to  £178,000,000,  against  £111,600,000  in  1904. 
This  capital  increases  daily,  and  considering  the  develop- 
ment of  the  network  of  railways  all  over  the  country,  it 
is  not  fantastic  to  prophesy  that  in  a  short  time  this  sum 
will  reach  the  figure  of  perhaps  £200,000,000. 

The  second  large  group  consists  of  the  securities  repre- 
senting the  External  National  Debt,  which  on  the  31st 
December  1908  stood  at  £62,900,000,  or  £7,400,000  lower 
than  that  of  the  debt  in  circulation  on  1st  July  1905. 
This  diminution  arises  from  the  redemption  of  bonds  by 
means  of  the  6  per  cent.  Funding  Loan,  of  which  the  total 
was  £5,600,000. 

If  to  the  amount  of  this  debt  we  add  the  sums  represented 
by  the  external  debt  of  certain  cities,  the  internal  debt  of  the 
nation,  and  the  internal  debt  of  some  of  the  Provinces,  we 
find  that  the  entire  Argentine  National  Debt  forms  a  total 
of  £130,000,000  We  need  not  examine  at  greater  lengths 
the  composition  and  value  of  these  two  groups  of  securities, 
as  we  have  already  dealt  with  them  in  special  chapters. 

As  for  the  insurance  companies  and  foreign  banks,  any 
estimate  of  their  capital  is  difficult ;  but  it  is  otherwise 
in  the  case  of  the  mortgage  companies.  The  capital  which 
these  companies  have  invested  in  the  Argentine  is  now  of 
a  nominal  value  of  more  than  £16,500,000.  But  this  is  only 
a  small  portion  of  the  foreign  capital  invested  in  mortgages 
in  the  Argentine ;  for  the  high  interest  earned  by  this  class 
of  investment,  which  a  short  time  back  rose  to  10  per  cent., 
has  attracted  large  sums  of  foreign  money  which  have  been 
invested  privately.  Senor  Tornquist  estimates  the  foreign 
capital  thus  put  out  in  mortgages  at  £9,000,000. 

We  must  call  attention  to  the  interesting  fact  that  the 
amount  of  foreign  capital  invested  in  the  agricultural  and 
other  rural  undertakings  of  the  Argentine  increases  day 
by  day.  At  the  end  of  1908  this  capital  amounted  to 
£8,726,037,  of  which  the  greater  part  was  the  property  of 
British  subjects,  who  first  devoted  their  energies  to  agriculture 
and  stock-raising  in  the  Argentine  a  comparatively  long 
time  ago.    It  is  the  English  who  have  been  the  most  active 


THE  BALANCE-SHEET  OF  THE  ARGENTINE   355 

.agents  of  the  rapid  and  extraordinary  procuress  of  Arcjentine 
stock-raisiug,  especially  iu  all  that  relates  to  the  selectitm  ol" 
breeds  and  the  best  manner  of  feeding. 

Among  the  industrial  undertakings,  that  which  lias  of 
late  years  assumed  the  greatest  importance  is  the  frozen 
or  chilled  meat  industry — the  refrigerating  industry.  There 
are  now  nine  refrigerating  establishments,  with  a  subscribed 
capital  of  £3,993,915.  Other  industrial  undertakings,  such 
as  sugar  factories,  breweries,  quebracho  mills,  and  mines, 
are  beginning  to  take  a  significant  place  in  the  list  of 
Argentine  securities. 

The  nominal  total  of  all  movable  values  being  estimated, 
at  the  end  of  1908,  at  £474,396,933,  the  question  which  now 
occurs  is.  What  is  the  annual  yield  of  these  securities  ? 
This  is  the  most  difficult  point  of  our  inquiry,  and  one  we 
can  answer  only  by  approximate  estimates. 

While  it  is  simplicity  itself  to  calculate  the  interest  on 
the  bonds  of  the  public  debt,  whether  external  or  domestic, 
it  is  anything  but  easy  to  calculate  in  all  cases  the  dividends 
paid  by  each  company  to  its  shareholders.  Some  companies 
do  not  publish  balance-sheets,  and  others  confound  the  profits 
realised  in  the  Argentine  with  the  profits  earned  by  their 
foreign  houses  or  headquarters. 

As  far  as  our  present  knowledge  goes,  the  revenue  of  the 
securities  we  have  mentioned  may  be  estimated  to  be  as 
follows : — 

Annual  Revenue  of  the  Securities!  of  the  Argentine 
Republic,  Slst  December  1908. 

Name  or  Nature  of  Securities.  PoundrSterling. 

External  National  Debt                 ...             ...             ...             ...  £3,209,727-2 

Internal             ,,                               843,879-4 

Municipal  Debt  of  BuenoB  Ayres  ...             ...             ...             ...  196,135'4 

„            ,,         Santa  F6           ...             ...             ...             ...  1,636-0 

,,            ,,        Roeario            ...             ...             ...             ...  120,000-0 

Cdrdoba            ...             ...             ...             ...  19,500-0 

BahiaBIanca   ...             ...             ...             ...  6,600-0 

External  Debt  of  the  Province  of  Buenos  Ayres      ...             ...  368,928-0 

Internal                 „                  „                   „                   255,904-0 

Cedulaa  of  the  National  Mortgage  Bank     ...             ...             ...  872,051-6 

Debts  of  the  Provinces  of  Tucuman  and  Entre  RioB               ...  29,013-4 

Carryforward         £5,923,374-0 


356    THE  ARGENTINE  IN  THE  20th  CENTURY 


Armual  Revenue  of  the  Securities  of  the  Argentine 
2\st  December  1908 — continued. 

Name  or  Nature  of  Securities. 

Brought  forward 
Debt  of  the  Province  of  Santa  Fe 
Railway  Companies 
National  Banks  of  the  Capital 
Anglo-Saxon  Banks  of  the  Capital 
Local  Provincial  Banks 

Mortgage  and  Agricultural  Loan  Companies 
Tramway  Companies 
Gas  and  Electric  Companies 
Telegraph  and  Telephone  Companies 
Harbours,  Docks  and  Quays 
Savings   Banks,  Building   Societies,   Annuity  and   Insurance 

Companies 
Agricultural  and  Stock-raising  Companies 
Forestal  Exploitation  Companies 
Refrigerating  Companies 
Markets 

Mining  Companies 
National  Insurance  Companies 
Sugar  Refineries 
Breweries 
Dairy  Companies 
Metallurgical  Companies 
Transport  Companies     ... 
Hotel  and  Theatre  Companies 
Mills  and  Gr-anaries 
Various  Industries 
General  Commercial  Companies  ... 


Revenues  in 
Pounds  Sterling. 

£5,923,374-0 

67,745-0 

8,423,510-8 

1,131,499-6 

788,680-8 

53,725-6 

1,044,847-2 

907,603-8 

804,578-2 

97,478-6 

293,447-8 

254,852-2 

496,309-2 

188,505-0 

229,654-2 

165,243-8 

23,816-8 

192,040-4 

165,154-6 

174,2490 

31,882-6 

40,605-0 

251,783-2 

59,332-6 

33,765-2 

169,253-8 

141,957-3 

£22,144.939-2 


Now  what,  approximately,  are  the  amounts  of  securities 
or  movable  values  belonging  to  foreigners  and  to  natives 
of  the  Argentine  ?  Such  is  the  question  we  must  now  set 
ourselves,  as  one  of  the  most  important  relating  to  the 
country's  future.  Blessed  with  an  immense  area  of  territory, 
mistress  of  enormous  and  unexhausted  natural  wealth,  and 
peopled  by  only  6  millions  of  inhabitants,  the  Argentine  is 
a  nation  still  in  process  of  formation.  She  attracts  men 
and  money  from  all  quarters  of  the  globe ;  for  she  promises 
generous  payment  for  initiative  and  for  labour. 

From  the  economic  standpoint,  then,  it  is  of  enormous 
importance  for  the  Argentine  whether  the  revenue  of  her 
securities  goes  to  persons  residing  in  the  country,  or  whether, 


THE  BALANCE-SHEET  OF  THE  ARGENTINE  357 

on  the  other  hand,  it  goes  abroad,  thus  unfavourably  affect- 
ing the  result  of  her  commercial  transactions,  and  threatening 
to  upset  the  balance  of  international  payments. 

In  the  case  of  a  country  which  exists  under  the  special 
conditions  which  affect  the  Argentine,  where  there  are  no 
accumulations  of  capital,  where  the  spirit  of  enterprise  is 
not  very  highl}^  developed,  and  where  every  commercial  or 
industrial  undertaking  of  any  importance  has  to  look  to 
the  outer  world  for  support,  the  total  of  the  suras  which 
leave  the  country  each  year  to  pay  for  imported  articles, 
to  meet  the  interest  on  the  National  Debt,  to  pay  the 
dividends  on  the  shares  of  limited  companies,  and  the  profits 
of  private  undertakings,  the  interest  on  capital  out  on  loan, 
whether  on  mortgage  or  otherwise  secured,  and  finally  to 
remunerate  capital  invested  and  employed  in  the  thousand 
different  ways  peculiar  to  this  period  of  rapid  intercommuni- 
cation—  the  total  of  all  these  sums  must  be  very  great ; 
something,  indeed,  like  a  metallic  river  rolling  across  the  ocean. 
So  much  being  granted,  the  moment  has  come  to  present 
the  problem  :  of  the  22  million  pounds  required  to  pay  the 
interest  on  loans,  the  sinking-fund  charges  for  their  redemp- 

.  tion,  and  the  dividends  of  hundreds  of  companies,  what  is 
the  proportion  which  each  year  leaves  the  Argentine  to 
become   spent  or   invested  abroad,  assuring  the   owners   of 

■  bonds  and  shares  the  best  part  of  the  revenue  of  a  distant 
country,  a  country  endowed  with  a  fertile  soil,  in  which 
industry  has  a  great  future  awaiting  it  ?  And  what  propor- 
tion of  this  total  remains  in  the  country  ? 

To  solve  this  problem,  it  would  be  necessary  to  follow 
the  track  of  each  of  the  shares  or  bonds  issued,  in  order  to 
discover  the  destination  of  each ;  and  this  is  what  we  shall 
attempt  to  do,  with  the  help  of  the  principal  banking  houses 
and  the  great  commercial  houses  in  financial  relations  with 
the  outer  world. 

Although  all  estimates  on  such  a  subject  must  rest  upon 
the  slightest  foundations,  and  cannot  be  accepted  as  precise 
statistics,  we  do  not  hesitate  to  give  a  few  figures  as  an 
indication  worthy  of  credence,  being  drawn  from  the  best 
possible  sources. 

To  proceed  with  due  method,  let  us  begin  with  the  most 


358    THE  ARGENTINE  IN  THE  20th  CENTURY 

important  division  of  the  foreign  capital  invested  in  the 
Argentine,  namely,  English  capital,  which  was  the  first  to 
come  from  abroad  to  stimulate  the  progress  of  the  country. 
According  to  an  inventory  made  by  the  banking  house  of 
Tornquist  &  Co.,  which  has  willingly  given  us  the  informa- 
tion we  required,  the  capital  imported  from  England  and 
invested  in  Argentine  securities  amounts  to  more  than 
£290,000,000,  distributed  as  follows:— 


English  Co.pital  Invested  in  the  Argentine. 


Capital. 

Intorest. 

Loans — Governmental,  Provincial, 

Municipal 

...  £63,854,643-8 

£3,046,598-2 

Railways      

..  166,360,683-2 

8,049,431-8 

Banks            

..       7,862,400-0 

705,096-0 

Agricultural  Loans  and  Mortgages 

..       6,847,216-6 

259,732-2 

Tramways 

..     20,284,705-6 

876,603-8 

Electricity 

5,152,590-4 

287,685-2 

Agriculture  and  stock-raising 

...       4,018,997-8 

248,204-8 

Various  investments           

...     14,729,708-8 

785,986-4 

£291,110,946-0 

£14,258,338-4 

Thus  this  sum  of  £291,110,946  sterling  represents  an 
annual  revenue  of  £14,258,338. 

To  continue :  in  seeking  to  find  the  true  amount  of  the 
economic  international  balance,  we  should  have  to  include  in 
the  inventory  of  English  capital  bound  to  the  Argentine  by 
commercial  transactions  the  large  number  of  steamers  which 
run  between  British  and  Argentine  ports,  whose  value  might 
be  represented  by  a  sum  not  less  than  £10,000,000. 

If  this  be  added  to  the  sum  already  obtained,  we  find  that 
the  English  capital  invested  in  the  Argentine  or  bound  to 
the  country  by  commercial  ties  is  not  less  than  £300,000,000 ; 
the  revenue  of  which,  estimated  at  an  average  of  6  per  cent., 
represents  a  sum  of  £18,000,000  per  annum,  entirely  paid 
out  of  the  production  and  the  economic  forces  of  the 
Argentine. 

To  test  the  accuracy  of  this  estimate  we  may  mention 
that  according  to  a  conscientious  study  of  English  capital  as 
placed  in  the  principal  countries  of  the  globe,  a  study  published 
in  1909  in  the  Economist,  the  sums  invested  in  the  Argentine 


THE  BALANCE-SHEET  OF  THE  ARGENTINE   359 

amount  to  £254.000,000  ;  a  ficrure  not  very  different  iVcm 
that  we  have  already  giveu. 

But  let  us  be  content  for  the  moment  to  realise  that  the 
known  inventoried  revenue  on  bonds  and  shares  beloncring 
to  British  companies  or  British  subjects  residing  or  situated 
in  England  amounts  to  £14,000,000  after  the  deduction  of 
the  portion  remaining  in  the  hands  of  Englishmen  residing 
in  the  Argentine;  and  in  the  presence  of  such  figures  let 
us  meditate  for  a  moment  on  the  social  and  economic 
consequences  of  such  a  fact. 

English  capital,  since  the  dawn  of  the  organisation  of 
Argentina,  has  been  the  great  propulsive  agent  of  all 
national  progress.  In  1822,  when  she  was  still  insignificant 
both  in  riches  and  in  population,  Argentina  knocked  for 
the  first  time  on  the  doors  of  British  capitalists,  asking  them 
to  lend  a  million  pounds  to  be  used  for  the  construction 
of  a  harbour,  for  the  instalment  of  waterworks  in  her 
capital,  and  for  the  foundation  of  cities  ;  projects  which  were 
never  executed ;  for  it  was  with  this  loan  as  it  was  to  be 
afterwards  with  many  other  Argentine  loans.  The  funds 
demanded  on  credit  were  not  employed  to  further  the 
object  for  which  they  were  solicited.  After  this  first 
loan  all  other  Argentine  loans  were  subscribed  by  British 
capital. 

Moreover,  no  industrial  or  commercial  undertaking  has 
been  established  in  this  country  but  it  has  gone  to  seek  the 
breath  of  life  in  the  financial  houses  of  the  City.  Professor 
Eteocle  Lorini  said  with  reason,  in  commenting  on  this  fact 
in  his  book,  II  Debito  Publico  Argentino :  "  All  the  industrial, 
commercial,  agricultural  and  mining  companies  which  furnish 
our  Argentine  statistics  bear  the  foreign  mark,  limited;  so 
that  one  ends  by  getting  the  impression  that  one  is  studying 
a  purely  English  colony,  for  one  finds  this  limited  upon  all 
species  of  manufactures;  limited  after  the  statement  of 
capitals;  all  undertakings  are  limited;  insurance  is  limited ; 
the  circulation  and  distribution  of  Argentine  wealth  is 
limited." 

Whatever  may  be  the  importance  of  the  limited  company, 
it  is  by  no  means  to  the  interest  of  the  Argentine  to  declare 
war  upon    foreign  capital ;    she   should,  on    the  contrary, 


360    THE  ARGENTINE  IN  THE  20th  CENTURY 

respect  the  far-seeing  provisions  of  her  Constitution,  which  ^j 
imposes  upon  Congress  the  duty  of  encouraging  the  introduc- 
tion of  foreign  capital  conjointly  with  a  foreign  population, 
because  both  are  vital  elements  of  the  national  development 
and  progress.  But  while  we  respect  this  tradition  we  feel 
that  the  Government  should,  in  counteraction,  endeavour  to 
stimulate  the  application  of  Argentine  capital  to  commercial  I 
or  industrial  enterprises,  in  order  that  the  entire  resources 
of  the  country  shall  not  be  developed  for  the  sole  profit  of 
the  foreigner. 

Professor  Lorini,  whom  we  have  just  quoted,  is  of  the 
same  opinion.  "  We  are  certainly  not  of  those,"  he  says, 
"  who  complain  of  the  introduction  of  foreign  capital.  The 
more  the  latter  is  imported,  the  more  it  gives  employment, 
and  increases  yet  more  the  wealth  and  welfare  of  the  country. 
But  we  must  also  add  that  as  more  capital  arrives  from 
without,  so  the  payments  which  the  country  has  to  make 
for  the  use  of  it  grow  larger,  and  for  this  reason  the  whole 
financial  policy  of  the  Government  and  the  Argentine  should 
have  as  its  object  the  introduction  of  the  severest  economy 
and  the  greatest  possible  thrift ;  not  only  that  engagements 
contracted  may  be  honourably  met,  but  that  in  course 
of  time  we  may  form  a  national  capital,  capable  of  com- 
peting with  foreign  capital,  of  reducing  its  pretensions, 
and  even  of  replacing  it  little  by  little,  should  the  latter, 
for  any  reason  whatsoever,  be  compelled  to  emigrate  in 
virtue  of  causes  foreign  to  the  economic  laws  of  the 
country." 

After  England  France  stands  in  the  first  rank  of  those 
European  nations  which  have  had  faith  in  the  future  of 
the  Argentine,  and  have  risked  the  investment  of  their 
capital  in  this  young  and  wealthy  state.  Unhappily  the 
total  amount  of  French  capital  invested  has  not  been 
augmented,  as  one  might  have  hoped,  by  the  political  and 
commercial  ties  which  for  many  years  have  united  the  two 
countries,  or  by  the  fertile  opportunities  which  the  Republic 
has  to  offer  to  the  activity  and  enterprising  spirit  of  the 
Latin  races. 

The  nominal  total  of  Argentine  securities  quoted  on 
the  Paris  Bourse  amounted,  on  the  31st  of  December  1907, 


THE  BALANCE-SHEET  OF  THE  ARGENTINE   .'^01 

to  the  value  of  £78,999,308,  which  sum  may  he  analysed  as 

follows : — 

State  funds £r>2,:?32,:i0»; 

Banks           10,;5;?r>,()80 

Transport 12,80L',L".>0 

Mines            r»4S,'.)78 

Various        2.1)80,000 


£78.900.25+ 


To  prevent  an  erroneous  interpretation  of  the  above 
figures,  it  should  be  stated  that  this  total  does  not  re- 
present the  value  of  the  securities  actually  held  by  French- 
men, but  only  the  securities  quoted  on  the  Bourse,  which 
is  a  very  different  matter.  For  example,  the  French  Bank 
of  the  Rio  de  la  Plata  figures  in  this  total  to  the  extent 
of  £2,400,000,  the  amount  of  its  capital  actually  subscribed, 
although  scarcely  a  quarter  of  it  circulates  in  France. 

On  the  other  hand  there  is  a  very  considerable  quantity 
of  Argentine  securities  belonging  to  capitalists  or  investors 
living  in  France  ;  securities  which  are  not  quoted  on  the 
Bourse  and  are  not  deposited  in  any  bank.  We  may  cite 
as  an  example  the  last  loan  of  £10,000,000,  issued  under  the 
title  of  "Internal  Argentine  Credit  1909."  Of  this  amount 
£3,400,000  was  subscribed  in  France,  yet  the  bonds  of 
this  loan,  on  account  of  a  difference  with  the  French  Govern- 
ment, have  not  yet  been  quoted  on  the  Paris  Bourse. 

We  are  thus  justified  in  concluding  that  the  amount 
we  have  given  as  representing  the  value  of  the  stock  held 
by  Frenchmen — £78,998,854 — is  approximately  correct ;  and 
that  the  two  factors  which  affect  the  matter  in  opposite 
senses  may  be  taken  to  cancel  one  another. 

We  must  also  note  the  fact  that  the  majority  of  Govern- 
ment funds  find  as  large  a  market  in  London  as  in  Paris. 
For  example,  the  4  per  cent,  loan  of  1897-1900,  which  was 
entirely  issued  in  London,  was  only  admitted  to  quotation 
on  the  Bankers'  Exchange  of  Paris  in  1903. 

In  the  banking  department,  the  shares  of  the  Spanish  Bank 
of  the  Rio  de  la  Plata  and  the  French  Bank  of  La  Plata  were 
only  introduced  to  the  Paris  Bourse  at  the  beginning  of  1908  ; 
the  principal  market  for  these  shares  is  still  at  Buenos  Ay  res. 

In   the   transport  department,  the  General  Company  of 


362    THE  ARGENTINE  IN  THE  20th  CENTURY 

the  Tramways  of  Buenos  Ayres,  which  has  a  capital  of  I 
£1,800,000,  can  only  be  represented  in  France  by  a  very 
small  proportion  of  this  capital ;  the  shares  have  been 
issued  principally  in  Brussels,  London  and  Berlin. 

We  must  remember  that  French  influence  in  the 
Argentine  has  been  active  for  a  long  time  and  in  various 
ways.  It  was  especially  the  immigration  of  the  worthy 
inhabitants  of  the  French  Pyrenees  which  first  set  in 
towards  the  Rio  de  la  Plata,  where  the  Frenchmen  invested 
their  energies  in  many  remunerative  departments  of  labour 
some  becoming  farmers,  some  cattle-breeders,  some  givin, 
themselves  to  industrial  work,  some  to  trade  in  the  cities ; 
thus  contributing  to  the  development  of  the  wealth  of  the 
country.  Thev  French  mercantile  marine  was  also  the  first 
to  establish  and  maintain  a  rapid  and  easy  transport  between 
French  and  Argentine  ports,  thus  permanently  uniting  the 
two  countries. 

As  for  French  commerce,  it  retained,  as  lately  as  1884, 
a  place  in  the  first  rank  with  regard  to  the  exchange  of 
manufactured  articles  or  the  products  of  the  soil,  the  trade 
being  carried  on  especially  through  the  medium  of  the  Rio 
da  la  Plata ;  indeed  there  was  a  time  when  French  commerce 
represented  51  per  cent,  of  the  total  trade  of  the  Argentine, 
while  now  it  is  responsible  for  only  20-7  per  cent,  of  the 
total  value  of  Argentine  imports  and  exports  uuited. 

We  may  therefore  consider  that  the  part  played  by  French 
capital  in  Argentine  affairs  is  much  too  small  as  compared 
to  the  function  of  English  capital,  and  we  must  regret  that 
France  is  not  more  deeply  interested  in  the  great  movement 
towards  national  prosperity. 

After  France  the  European  nation  which  has  invested 
the  largest  amount  of  capital  in  the  Argentine,  and  which 
has  fully  understood  the  true  importance  of  the  latter 
country,  is  Germany. 

In  the  remarkable  increase  and  expansion  of  her  industries 
Germany  has  not  forgotten  the  shores  of  the  Rio  de  la  Plata. 
She  has  entered  upon  a  struggle  with  England;  all  her 
electrical  and  chemical  undertakings  have  taken  root; 
factories  have  .sprung  up  due  entirely  to  German  capital ; 
a  German  Transatlantic  Bank  has  been  established  in  Buenos 


4 


THE  BALANCE-SHEET  OF  THE  ARGENTINE  363 

Ayres ;  the  Hamburg  South  American  Company  flies  its 
ensign  on  the  ocean,  swiftly  carrying  passengers  and  mer- 
chandise between  the  two  continents;  a  German  electrical 
company  has  established  its  power-houses  in  the  Argentine 
capital ;  an  extract  of  meat  company  is  drawing  its  profits 
from  the  live-stock  industry  ;  several  quebracho  mills  have 
been  founded ;  many  other  factories  have  been  established, 
and  the  Germans  have  thus  absorbed  a  large  proportion  of 
the  Argentine  export  trade.*  The  commercial  relations 
between  Germany  and  the  Argentine  increase  each  day. 
Twenty  years  ago  the  exchanges  between  the  two  countries 
represented  hardly  19*4  per  cent,  of  the  general  foreign  trade 
of  the  Argentine — at  a  time  when  France  possessed  51  per 
cent,  instead  of  her  present  20'7  per  cent,  of  the  trade — 
while  in  1908  the  exchanges  with  Germany  amounted  to 
23"4  per  cent,  of  the  entire  trade. 

What  is  the  total  value  of  the  German  capital  invested 
in  the  Argentine  Republic  ?  It  is  not  easy  to  say  with  strict 
accuracy  ;  but  according  to  the  very  authentic  information 
of  certain  Buenos  Ayres  bankers  we  may  reckon  that  the 
German  capital  employed  in  the  banks,  commercial  houses, 
estancias,  and  industrial  concerns,  and  in  the  German 
Electrical  Company,  the  electric  tramways,  etc.,  etc.,  amounts 
to  £40,000,000.  If  to  this  capital  we  add  that  represented 
by  the  vessels  under  the  German  flag,  which  maintain  an 
active  communication  with  the  Rio  de  la  Plata,  obtaining 
a  large  proportion  of  the  best  clients,  the  total  of  the 
German  capital  employed  in  the  Argentine  amounts  to  some 
£60,000,000. 

With  these  data  in  hand,  and  an  approximate  knowledge 
of  the  amount  of  foreign  capital  invested  in  this  country  in 
shares,  bonds,  and  other  securities,  namely  some  £3S4, 000,000, 
as  well  as  its  approximate  revenue,  which  in  round  figures 
is  about  £18,000,000,  plus  £1,600,000  as  the  general  sinking 

*  In  the  course  of  the  year  1908  there  left  BuenoB  Ayres,  in  the  veBsols  of 
▼arious lines,  10,805  first-class  passengers  for  Europe,  of  whom  2750  left  by  the 
German  Company  of  Hamburg ;  2041  by  the  Hoyal  Mail  Steam  Packet  Co.  ; 
1103  by  the  Messuf/eries  Maritimes  ;  791  by  the  Trunaportit  ,\fnritimrxd  mpevr . 
711  oy  the  Gnuidl  Italian  JSuviijutio:,  CV/. ;  i.h«  by  La  Vcime;  ofi.^  by 
the  Italia;  656  by  the  Lloyd  Sabando ;  377  by  the  Lloyd  Jtaltano;  340  by  tbo 
Upaniih  Tramatluntic ;  and  the  rest  by  vesselB  of  yarious  less  important  Uumb. 


364    THE  ARGENTINE  IN  THE  20th  CENTURY 

fund  charge,  or  in  all  about  £19,600,000,  we  may  draw  t 
following  conclusions : — 

We  know  that  the  revenue  of  the  bonds  held  by  t 
English  capitalists,  including  the  sinking  fund,  amour 
to  £14,158,337.  Again,  the  amount  necessary  to  pay  t 
interest  on  the  bonds  of  the  National  Debt,  cedulas,  c 
bentures,  and  shares  held  by  French,  German,  and  Belgii 
investors,  may  be  estimated  at  £3,698,779 ;  so  that  of  t] 
total  revenue  of  £18,493,896  produced  by  the  Republic,  the 
remains  in  the  country  a  balance  of  £4,287,820. 

The  Balance-sheet 

Nothing  is  more  difficult  than  to  bring  together  the  co 
stituent  elements  of  a  national  balance-sheet,  on  account 
the  complexity  of  the  necessary  facts  which  often  esca] 
the  net  of  the  statistician.  Beginning  with  the  mo 
important  elements  of  this  balance,  and,  so  it  seems,  tl 
most  plainly  visible — those  formed  by  the  movement  of  e: 
ports  and  imports  through  the  customs — and  ending  with  tl 
most  insignificant  facts,  there  are  still  a  large  number 
factors  for  which  it  is  impossible  to  allow. 

Taking  a  broad  view  of  the  matter,  we  must  first  of  a 
observe  that  the  estimates  by  which  we  finally  decide  th; 
that  which  leaves  a  country,  whether  in  merchandise  or 
specie,  is  of  greater  value  than  that  which  enters  it,  a 
extremely  arbitrary.  The  principal  means  of  appreciatic 
is  the  table  drawn  up  by  the  Customs  Administration  upc 
cargoes  leaving  and  entering  the  country,  but  the  resul 
drawn  from  this  table  are  inevitably  approximate.  On  tl 
one  hand  the  declarations  upon  which  the  valuations  ai 
based  are  always  untrustworthy,  as  they  are  made  fc 
individuals  who  are  interested  in  diminishing  the  actu 
values  of  their  consignments.  On  the  other  hand,  they  ai 
influenced  by  a  thousand  other  circumstances  which  th 
customs  cannot  take  into  account,  such  as  shipwrecks  an 
unfortunate  commercial  transactions. 

Moreover,  merchandise  exported  is  usually  valued  by  th 
customs  at  the  moment  of  leaving  the  port  of  embarkatior 
that  is,  when  it  has  so  far  paid  only  very  small  sums  fc 


CONCLUSIONS 

THIS  volume  does  not  call  for  a  long  summary ;  for  we 
have,  we  believe,  in  the  course  of  our  enquiry,  thrown 
sufficient  light  upon  the  characteristic  aspects  of  the  situation 
of  the  Argentine  to  enable  the  reader  to  judge  of  the  place 
it  now  holds  in  the  world-market  among  the  great  producing 
nations.  But  what  does  remain  for  us  to  do  is  to  sum 
up  in  broad  touches  the  fundamental  progress  realised  in 
the  last  few  years  ;  a  degree  of  progress  to  which  the  country 
is  indebted  for  its  modern  prosperity,  and  which  bears  the 
seeds  of  its  future  development. 

Firstly,  to  deal  with  the  matter  of  international  politics,  we 
must  remember  the  solution  of  the  frontier  dispute  with  Chili, 
which  for  more  than  fifty  years  was  a  cause  of  alarm  as  well 
as  of  expense,  and  which  had  threatened  to  become  embittered 
to  the  extent  of  arresting  the  stream  of  European  immigration 
and  European  capital  so  necessary  for  the  improvement  of  the 
Argentine  soil.  The  example  afforded  by  these  two  Republics 
of  South  America,  which  of  their  own  initiative  had  recourse 
to  arbitration,  rather  than  finally  settle  their  difference 
by  a  resort  to  arms,  and  then  pledged  one  another  to  delete 
gradually  from  their  budgets  the  unfruitful  item  of  military 
expenditure,  surely  indicates  that  a  new  spirit  is  awake 
in  the  Argentine,  and  that  she  looks  to  pursue  her  future 
destinies  along  the  paths  of  peace  and  industry. 

In  the  matter  of  economics  the  capital  fact  consists  in 
the  enormous  expansion  of  the  two  fundamental  industries 
of  the  country — agriculture  and  stock-raising.  To  measure 
the  ground  covered,  it  is  enough  to  mention  that  in  1900 
the  total  value  of  the  products  of  stock-raising  was  only 
£12,200,000,  while  in  1904  this  value  had  increased  to 
£21,000,000,  and  in  1908  to  £22,200,000.  It  has  been  the 
same  with  the  products  of  agriculture ;  in  nine  years  their 
export  value  has  increased  from  £14,600,000  to  £48,000,000. 

Under  the  stimulus  of  this  progress  an  intense  vitality 
has  manifested  itself  in  every  department  of  national  activity ; 
370 


CONCLUSIONS  371 

the  power  of  consurnption  of  the  Arcrentiiie,  as  measured  by 
the  statistics  of  importation,  has  largely  increased  ;  property 
has  in  many  places  attained  ten  times  its  former  value; 
commercial  transactions  of  every  kind  have  increased  ;  and 
new  industries,  such,  for  instance,  as  the  refrigerativo  industry, 
liave  been  created  and  are  prospering.  It  is  therefore  evident 
that  the  dominant  characteristic  of  the  present  situation  of  the 
Argentine  from  the  economic  point  of  view  must  be  sougiit 
in  the  remarkable  expansion  of  all  the  forces  of  production. 

The  most  eloquent  proof  of  this  economic  prosperity  has 
iust  been  furnished  by  the  late  census  of  agricultural  and 
pastoral  enterprises,  effected  in  1908  by  Senor  Martinez. 
The  total  value  of  these  undertakings,  representing  the 
better  part  of  the  national  wealth,  attains,  as  the  table  on 
the  following  page  will  show,  the  figure  of  £773,000,000. 

Now,  to  speak  of  financial  matters,  there  is  a  third 
factor,  which  came  very  opportunely  to  consolidate  the  results 
of  the  wonderful  expansion  we  have  spoken  of — the  law  of 
monetary  conversion.  While  it  was  laying  the  foundations 
of  the  future  conversion  of  the  fiduciary  circulation,  this 
law  created  a  reserve  fund  to  make  it  presently  prMcticable, 
and  so  gave  stability  to  the  instrument  of  exchanges ; 
suppressing  the  gold  premium,  so  p'rejudicial  to  business, 
aud  supporting  the  prosperity  of  the  country  by  a  fixed  and 
common-sense  currency  ;  a  support  which  the  country  needed 
in  order  that  it  might  develop  without  checks  and  shocks, 
but  one  it  had  hitherto  lacked.  No  measure  has  contributed 
more  than  this  to  the  relief  and  improvement  of  Argentine 
credit,  and  to  the  increased  value  of  the  public  funds,  which 
will  before  long  result  in  the  work  of  financial  reorganisation. 

The  results  of  this  happy  conjunction  of  political,  economic, 
and  financial  facts  were  not  long  to  seek ;  for  in  less  than 
five  years  the  Argentine  passed  from  a  state  of  chronic  crisis 
to  the  fullest  prosperity  known  since  her  existence  as  a  nation. 
But  to  preserve  all  the  benefits  of  the  progress  accomplished 
the  young  Republic  has  still  one  task  to  fulfil :  to  fortify 
domestic  peace,  to  perfect  her  political  system,  and  to  improve 
her  principles  of  administration ;  conditions  indispensable 
to  the  assured  and  normal  development  of  the  country  and 
its  future  greatness. 


372 


THE  ARGENTINE  IN  THE  20th  CENTURY 


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INDEX 


Ac;iuoULTURE,  peculiarity  of  production, 
109  (125-153);  principal  regions, 
125  ;  chief  crops,  126  ;  size  of  hold- 
ings, 127-9;  land  agencies,  130-1  ; 
usual  land  tenure,  132  ;  dependent 
on  railwa)'s,  132;  produce  (tables), 
1:^5.  136,  137  (table);  increase  of 
sown  lands,  139  ;  statistics  of  area 
(table),  140-1  ;  profits  of  (tables), 
117-151  ;  wheat,  154-161  ;  agricul- 
tural exports  (table),  227  ;  total  value 
of  agricultural  and  pastoral  holdings, 

Agricultural  census,  see  Census 
Agricultural  industries,  sec  Industries 
Agricultural  machinery,  sec  Machinery. 
America,  sec  United  States 
Andes,  climate  of,  73 
Area,  of  Argentine,  72  ;  cultivable,  76 
Argentine  nationality,  the,  59-68 
Argentine  Republic,  the  position  of,  71  ; 
boundaries      71  ;      area,      72 ;      cli- 
mate,    72-4;      soil,     74-6;     scourge 
of  locusts,   77  ;  rivers,  77  ;  almost  a 
desert    nation,    115  ;    production    of 
v.heat   in,    154-161;    foreign   trade, 
•J  11-234 
A  >lria,  trade  with,  226 

Hahia  Blanca,  port  of,  89-90 

3:  lance-Sheet,  the,  of  the  Argentine, 
(349-372);  securities  in  circulation 
(table),  352  ;  revenue  of  same  (table), 
355-356  ;  interest  paid  on  foreign 
capital,  357  ;  table  of  English  capital. 
358  ;  of  French,  361  ;  German,  363  ; 
favourable  balance,  367  ;  total  value 
of  farm.s  and  estates,  372 

Banks.  (261-278) ;  balance-sheets  of, 
265-268  ;  nature  of  business,  266-70  ; 
clearing-house,  270  ;  balance-sheet 
of  the  Bank  of  the  Province  of  Buenos 
Ayres,  274  ;  see  Mortgage  Banks 

Bank  of  the  Nation,  the,  270  ;  balance- 
sheets,  272 

Belgium,  trade  with  the  Argentine, 
219-225 

Boundaries  of  the  Republic,  71 

Bourse,  the  (278-286);  extent  of  oper- 
ations, 280-1 ;  organisation  of,  276; 
regulations,  283  ;  table  of  operations, 
283-4  ;  value  of  securities  quoted, 
284 

Brazil,  trade  with  the  Argentine,  219, 
225 


Breweries,  242  (table),  243 

Budget,  the  (295-309);  amounts  of, 
296  ;  cause  of  excessive  budgets 
299-304  ;  composition  of,  305 

Buenos  Ayres,  83 ;  harbours  of,  84  ; 
market  of,  with  statistics  (tal)le),  84- 
5  ;  port,  inward  and  outward  trade  of, 
85  (table)  ;  importance  as  a  port,  »6. 

Buenos  Ayres,  province  of,  142 

Bullion,  imports  and  exports  of  (table), 
218 

Butter,  exports  of  (table),  241-2 

Canada,  wheat  production,  160-1  ;  im- 
migration policy,  161 

Capiial,  foreign,  invested  in  the  Argen- 
tine, 351  ;  English,  358  ;  French, 
301  ;  German,  303 

Cattle.  numV)ers  of  (table).  241 

Census,  agricultural,  of  1905,  127  ;  of 
1908,  128  ;  of  1888, 134  ;  of  stock  of 
years  1888,  1895  and  1908,  169:  of 
1908,  171  :  of  cattle,  1895  and  1908, 
172  :  1895  and  1908,  241-2;  of  land, 
1908,  372 

Cereals,  cimgestion  of,  on  railways,  109  ; 
shipping  of,  110;  warehoused  at 
railway  stations,  112;  where  grown. 
126  ;  area  under,  142-4 

Colonisation,  commencement  of,  116; 
comparative  failure  of  policy,  117, 
121 

Colonising  agencies,  131 

Commerce,  see  Foreign  Trade ;  com- 
mercial balance  (table),  212.  232-4  ; 

Companies,  sec  Limited  Companies 

Concessions,  liarbour,  88  ;  railway,  99 

Conversion,  Vnissc  de  (342-348);  con- 
version fund,  343;  failure  at  first, 
343-5  ;  operation  under  new  laws. 
347  :  metallic  reserve  of,  347  ;  present 
functions  of,  348 

Cordoba,  142-4 

Cotton,  199-201  ;  profits,  200 

Currency,  the  double  (330-341) ;  origin 
of,  330-1 ;  depreciation  of  paper,  331- 
2;  bimetallic  .standard  established 
and  suppressed,  332  ;  gold  premium, 
332-3  :  excessive  issues  of  paper, 
334  ;  law  of  conversion,  337  ;  specu- 
lation in  exchange  killed  by,  339  ; 
monetary  situation  of  the  country, 
341.     SeeCa  isse  de  Con  vers  inn 

Daiky  industry,  240  (table),  241,  242 


373 


374 


INDEX 


Electric  lighting,  257 
Electrical    industry,    the,    256 ;    tram- 
ways, 256  ;  (table),  257 
England,    wheat    imported    by,    from 

Canada,  161 
Estancias,  model,  163-167 
Exchange,  see  Double  Currency 
Exports,  see  Trade.     Tables  of,  160  ; 
of  wheat,  159  ;  of  general,  213,  221 ; 
of  meat,  239  ;  of  butter,  241 

Finance,  see  Balance-Sheet  of  the  Ar- 
gentine. 

Financial  crisis,  the,  289-291 

Fisheries,  248 

Flour  exports,  237 

Foreign  trade  (211-234) 

France,  trade  with  the  Argentine,  219, 
224  ;  French  tariffs  highly  unfavour- 
able to  the  Argentine,  223;  decad- 
ence of  trade,  223-4,  229 

Fruit-farming,  202,  207 

Germany,  trade  with  the  Argentine, 
219,  222 

Great  Britain,  trade  with  the  Argen- 
tine, 219,  222 

Harbours,  set  also  Ports,  develop- 
ment of,  S3 

Immigration,  (113  -  121) ;  supremely 
needed,  114  ;  paradise  of,  115  ; 
statistics  of,  118-9 ;  statistics  of 
(table),  120  ;  difl5culty  experienced 
by  immigrants  who  wish  to  buy  land, 
121  ;  mistaken  policy,  121 ;  in 
Canada,  161 

Imports,  sec  Trade  and  Tables  of,  219, 
226 

Industries,  Agricultural  (187-207) ; 
sugar-planting  and  making,  187-192  ; 
profits  (table),  189 ;  yine-growing 
and  wine-making  (table),  192-195  ; 
tobacco-planting,  195  ;  acres  planted 
(table),  196  ;  cultivation  of  the 
mulberry  and  sericulture,  196-7  ;  the 
mate  industry,  197-8;  imports  (table), 
198  ;  cotton  -  planting,  199  -  201  ; 
where  grown,  199  ;  profits,  200  ; 
oil,  201  ;  rubber,  201 ;  fruit-growing, 
202-207 

Industries  (235-249)  ;  dependent  on 
agriculture  and  stock-raising,  235  ; 
sugar  factories,  236-7  ;  flour-milling, 
237  ;  refrigerating  industry,  238  ; 
(table),  239  ;  dairy  industry,  240  ; 
(table), 241-2 ;  brewerie3,242  ;  (table), 
243  ;  weaving,  244  ;  tanning,  244  ; 
the  quebracht)  industry,  244-248 , 
timber,  248  ;  fisheries,  248  ;  mining; 


251-5  ;  electrical,  256  ;  (table),  257  ; 
electric  lighting,  257  ;  (tables),  258-& 

Italy,  trade  with  the  Argentine,  219,. 
226 

Japan,  trade  with,  230-1 

Labour,  great  opportunities  of,  115 

Land,  vicious  system  of  ownership, 
118  ;  prevents  colonisation,  121  ; 
average  size  of  holdings,  127-9  ; 
national  possessions  and  enormous 
private  holdings,  129  ;  land  law  of 
1907,  130  ;  system  of  tenure,  132 ; 
agencies,  131  ;  auctions,  131-3  ;  areas 
in  cultivation,  134 ;  rise  in  value, 
139;  values  of,  and  sales,  174-185 

Limited  Companies  (286-292)  ;  consti- 
tution of,  286-8  ;  the  crisis  of  1890, 
289-291  ;  tableof  capital  invested  in, 
291 

Linseed,  profits  of,  150 

Locusts,  77 

Lucerne,  137-8  ;  use  of  in  stock-raising, 
162  ;  affects  value  of  soil,  174 

Machinery,  agricultural  (table),  144- 
5  ;  tables,  146,  148 

Markets,  Buenos  Ayres  (table),  84 

Mate,  197-8  ;  where  gathered,  197  j 
imports,  198 

Mitayage,  133,  138 

Mines  (250-5) ;  gold,  silver,  copper, 
coal,  antimony,  sulphur,  etc. ,  253-4  ; 
mining  laws,  255 

Mortgage  Banks,  275-278 

Mulberry,  cultivation  and  use  of ,  196-7 

National  debt,  the  (312-329);  tabu- 
lated amount  of,  312  ;  first  loans, 
314  ;  further  loans,  315-321  ;  table 
of  internal  debt,  322 ;  total  debt, 
323  ;  interest  on,  324 

Nationality,  the  Argentine,  59-68 

Pampa,  the,  75,  144  ;  production  of 
wheat  per  acre,  157 

Pampero,  the,  73 

Parana,  Rio,  the,  79  ;  navigable  value 
and  dredging  of,  80-1  ;  ports  on  the, 
82,  88-9 

Plata,  La,  port  of,  86 

Plata,  Rio  de  la,  79 

Plate,  river,  see  Plata 

Population,  density  of  (table),  113-4  ^ 
117 

Ports,  82  ;  statistics  of  (table),  83  ;  on 
the  Parana,  82 ;  Buenos  Ayres, 
trade  of  (table),  85 ;  see  Plata,  86  •, 
Bahia  Blanca,  89 

Property,  large  private,  129 

Provinces,  population  of,  113-4  ;  pro- 
duce of,  137 


INDEX 


375 


Quebracho  wood,  effect  on  value  of 
land,  74-5;  the  quebracho  industry, 
244-248 

Bailwats  (91-112)  ;  mileage  of  (table), 
93  ;  general  statistics  (table),  94  ; 
comfort  and  equipment,  95  ;  statistics 
(table),  96-7  ;  revenues  of,  98  ; 
administration  and  tariffs  (table). 
98-9 ;  cost  of,  99  ;  concessions. 
99  ;  guarantees,  99  ;  mileage,  100-1  ; 
comparative  mileage  (table),  102  ; 
projected  lines,  103-4  ;  Government 
policy,  104  ;  future  development, 
106  ;  celebrated  aerial  railway,  107  ; 
indispensable  auxiliary  of  produc- 
tion. IDS  ;  congestion  of  traffic,  109  : 
milea!,'e  and  capacity  of  cars  (table), 
111  ;  warehousing  by,  112 

■Rainfall,  73 

Refrigerating  industry,  238  ;  (table\  239 

Revenue,  305-310 

Rivers,  77  82 

Bosario,  capacity  as  port.  80-81  ;  second 
port  of  Argentine,  87-8 

Eubber,  201^2 

Santa  Fe,  142-3 
Seasons,  72 
Sericulture,  196-7 
Shipping,  110 

South  Africa,  trade  with,  225 
Spain,  trade  with  the  Argentine,  219 
Stock  Exchange,  the,  see  Bourse 
Stock-raising,   (162-173),    125;   where 
fallowed,  127  ;  probable  de(.-ay  of  old 
large  estancias,  130  ;  industry  under- 
going    modification,    162 ;      use     of 
lucerne  in,  162 ;    account   of   model 
establishments,   163-167 ;    breeds  of 
horses,  163  ;  cattle,  163  ;  sheep,  164, 
etc..  seq.  ;   importation   of  pedigree 
animals,  168  ;  statistics  (tables),  169, 

171,  172, 173  ;  value  of  stock  (tables), 

172,  173 

|8ngar  (187-192) ;  where  grown,  187-8  ; 
profits  (table),  189  ;  size  of  harvests. 
191  :  bounties,  195,  236-7 


Tanning,  244 

Tariffs,  215-217 

Taxes,  direct  and  indirect,  305-308 

Telegraphs.  257 

Telephones,  258 

Temperature,  72 

Territories,  national,  population  of, 
113-4  (table):  private  proptrtyin,  129 

Textile  industries,  244 

Timber  trade,  24S 

Tobacco.  195-196 

Trade,  foreign  (211-234);  exports  and 
imports  (table),  213  ;  excess  of  ex- 
ports (table),  214  ;  metallic  imports 
(table),  218  ;  imports  with  countrieB 
of  origin  (table),  218  ;  inijiorts  (table), 
220  ;  exports  (table),  221  ;  commer- 
cial balance,  232-4  ;  sec  industries 
(234-249) ;  in  chilled  or  frozen  meat 
(table),  239  ;  value  of  exports,  326 

Tr.ade,  see  Industries 

Traffic,  through  ports  (table),  83  ;  rail- 
ways, 89-112  ;  shipping,  110 

Tramways,  horse  and  electric,  256  ; 
(table),  257 

United  States,  wheat,  production  of 
(table),  158  ;  exportation  of  (table), 
159  ;  trade  with  the  Argentine,  219, 
229 

Uruguay  River,  79 

Valuation  of  Soil  (174-186),  see  Land 
Vines,  127  (192-5)  ;  where  grown,  192 

Whaling,  248 

Wheat  (154-161);  statistics  of ,  136,  137 
(table)  ;  profits  of  growing  (tables), 
148-9  ;  production  of  (tables),  154-5  ; 
production  per  acre,  157  ;  production 
in  U.S.A.  (table),  158  ;  yield  yter 
acre  in,  158  ;  exportation  of  (table), 
159  ;  exportation  from  Argentine  and 
India  (table), \60  ;  in  Canada,  160-1 

Wine,  193  ;  imports  of,  193  ;  consump- 
tion of,  193-4  ;  production  of  (table), 
194  ;  capital,  195 


LIST  OF  TABULAR  STATISTICS 

Traffic  passing  through  Argentine  ports,  1907-8 
Produce  entering  Buenos  Ayres  market,  1905-8 
Inward  and  outward  trade  of  port  of  Buenos  Ayres 
Railways,  mileage  of 

,,         general  statistics  of 

,,         gauge,  mileage  and  dividends 

,,         freight,  cost  of     . 

,,         mileage  of,  comparative  . 

,,         rolling  stock  and  its  capacity 


PAGE 

83 

85 

85 

98 

94 

96-7 

99 

102 

111 


376 


INDEX 


Population  of  Provinces  and  Territories 
Immigration  and  emigration,  1904-8 

1897-1908 
Progress  of  cereal  production,  1888-1905 
Production  of  cereals,  per  province  . 
Area  of  land  under  cultivation  in  five  regions 
Imports  of  agricultural  machinery    . 
Agricultural  machinery  required  by  farmer  cultivating  250  acres  of  wheat 
Approximate  expenses  and  profits  of  the  same 
Wheat,  the  world's  production,  1894-1907    . 

,,      distribution  of  crops,  1894-1907 

,,      produced  in  the  United  States,  1877-1907    . 

„      exported  from  the  United  States,  1879-1902 

,,      Argentine  and  Indian  exportation  compared 
Census,  cattle,  etc.,  according  to,  1888,  1895,  1908 

. ,      number  of  different  animals  according  to     . 
Cattle,  analytical  statistics  of,  1908 

,,       horses,  etc.,  values  of.  1895,  1908     . 

,,      horses,  etc.,  table  of  national  and  comparative  possessions 

,,  ,,  ,,  values 

Sugar-cane,  outgoings  and  receipts  on  12  acres 
Wine,  national  and  comparative  production  of 
Tobacco,  area  planted  with,  1895,  1907 
Mate,  importation  of  ....  . 

Trade:  exports,  imports,  population  and  commercial  balance,  1861-1908 

,,       exports,  excess  of      . 

,,       exports  and  imports  of  bullion 
Imports  and  countries  of  origin,  1906-1909 

,,       analysis  of,  1906-1909 
Exports,  destination  of,  1906-1909  . 

,,        increase  of  various  branches,  1906-1909 
,,        of  meat,  chilled  and  frozen 
, ,        of  butter    .... 
Breweries,  consumption  and  production,  1902-1907 
Tramways,  horse  and  electric,  of  Buenos  Ayres,  increase  of  takings,  1901 

1908       .... 
Factories,  statistics  of 
Industries,  various   . 
Banks,  accounts  of  principal 

,,       statistics  of    . 
Bank  of  the  Nation,  accounts  of,  1904-1908 

,,     of  the  Province  of  Buenos  Ayres,  accounts  of,  1906-1908 
Banks,  mortgage,  capital  of  .... 

Bourse,  operations  of,  1895-1908      .... 

,,       value  of  securities  quoted  on  .  .  . 

Companies,  floated  in  1905-8,  capital  of       . 
Debt,  national  or  public,  1909  .... 

,,     internal,  1909 

,,     external  and  internal  .... 

,,     interest  on      . 
Securities,  summary  of  Argentine  and  capital,  re]^resented  by 

,,  revenue  of  Argentine      .... 

Capital,  English,  invested  in  Argentine 
. ,       French,  invested  in  Argentine 
Agricultural  and  pastoral  property,  total  value  of,  1908 


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